Amarillo, Texas: Home sales rebound in June, prices steady

Amarillo, Texas, had taken a pass on the recession until this year.

Now the Panhandle city is feeling the impact, says Karr Ingham, a regional economist in Texas. Unemployment is on the way up, and consumer spending is slowing.

For now, though, Amarillo has the state's lowest unemployment rate.

"Nobody is going to escape the recession, but so far, we just have flesh wounds," says Tracy Howland, president of the Amarillo Association of Realtors.

In the first quarter, the housing market felt the pinch.

Home sales were down as many people worried about the economy and how it might affect their jobs.

Prices managed to stay the course, though. During prior tough economic times, that hadn't always been the case.

"In the 1980s, when the oil and gas industry took us down into a recession, that was characterized by a dramatic drop in the value of residential housing," Ingham says.

In June, homes sales started to perk, moving up 4% compared with the same month last year. That's significant, because sales were down 18% in the first six months of the year compared with the same period in 2008.

"Consumer confidence was up a little, and people were feeling more at ease to buy homes," Howland says of June.

Lower-priced properties are selling, as first-time home buyers are taking advantage of the tax credit. But homes costing more than $500,000 are lingering, because it's difficult for buyers to get jumbo mortgages, says James Gaines, a research economist at Texas A&M University's Real Estate Center.

"But it's not a market that has wild swings," he says.

Located in the vast, open cattle country of the Panhandle, Amarillo seems isolated from the rest of the state. But it has more economic diversity than just cattle and oil. Among its employers are Bell Helicopter Textron and Pantex Plant, which maintains the nation's nuclear weapons stockpile.

Unemployment may rise because of the recession. "But if Amarillo can now get through this downturn without a serious dip in home value, it will have done fairly well for itself," Ingham says.