Will the increased dollar volume from international buyers translate into higher tax revenues or public spending that could indirectly benefit local infrastructure and construction projects?

Analysis

The 9 % year‑over‑year rise in Texas‑wide residential sales to foreign buyers lifts overall transaction value, which in turn lifts property‑tax receipts for counties and municipalities that rely on a per‑$‑assessed‑value levy (often 1‑2 %). Assuming the current 1.2 % average residential tax rate in Texas, a 10 % boost in assessed‑value volume translates into roughly a 10 % increase in local tax‑revenue forecasts. Those incremental revenues are typically earmarked for general‑purpose funding rather than dedicated infrastructure projects, but most local jurisdictions in Texas (e.g., Austin, Dallas‑Fort Worth, San Antonio) have historically funneled a sizable share of the surplus into capital‑improvement budgets (roads, schools, utilities). Consequently, a sustained uptick in international buyer activity can be expected to boost municipal “capital improvement” budgets over the next 12‑18 months, indirectly supporting demand for construction material, labor, and related services.

Trading implications

• Construction & material stocks – With higher local tax receipts likely to translate into modest, near‑term infrastructure spending, construction‑related equities (e.g., Vulcan Materials (VMC), Lennar (LEN), regional builders such as D.R. Horton (DHI)) are positioned for incremental demand. Look for bullish price action if the sector’s relative strength index (RSI) remains below 70 and the 20‑day moving average stays above the 50‑day, confirming a short‑term bullish trend. A breakout above the recent high (~$30 for VMC, ~$100 for DHI) on volume could be a good entry point.

• Real‑estate REITs – Residential REITs with significant Texas exposure (e.g., American Homes 4 Rent (AH4R)) may benefit from higher transaction volumes that lift rent growth and occupancy. A bullish divergence on the 5‑day MACD (positive cross) paired with a >3 % earnings‑growth forecast from the latest 10‑K suggests a “buy‑the‑dip” opportunity if prices dip below the 200‑day moving average.

Actionable take‑away

Monitor the Texas Comptroller’s quarterly “Tax Revenue and Expenditure” releases (due Q1 2026). A confirmed rise in capital‑expenditure allocations would validate the bullish premise for construction‑related equities. In the meantime, consider a modest overweight (≈10 % of a balanced equity allocation) toward Texas‑focused construction and REIT exposure, while keeping a tight stop (≈5 % below entry) to manage the risk of a slowdown in foreign buyer sentiment if global interest rates rise sharply.