Port Arthur and Beaumont, Texas, two cities on the Gulf Coast have seen average prices surge this year from $117,000 the third quarter of 2006 to $129,000 for the same period in 2007. In just three years, average prices of homes have jumped more than 38 percent.

The Milken Institute's 2007 Best Performing Cities Index ranked the Beaumont-Port Arthur area in the Top 100 top performing cities, according to Texas A&M University's Real Estate Center. The Index, which ranks U.S. metropolitan areas based on their ability to create and sustain jobs, ranks cities according to five and one-year forecasts.

"Beaumont-Port Arthur came in at number 85, a significant improvement over the 2005 ranking of 167. In five-year job growth, the area came in at number 144, while one-year job growth was near the top at Number 28," according to the Institute.

Economic development continues to bolster the region's housing market. The most recent announcement is the construction of a $1.6 billion gasification plant which will eventually add more than 2,000 jobs to the labor force in the region.