Obama taps San Antonio Mayor Julian Castro as new HUD secretary
President Barack Obama (C) and US Secretary of Housing and Urban Development (HUD) Shaun Donovan (L) listen as San Antonio Mayor Julian Castro speaks during a ceremony at the White House on May 23, 2014 [AFP]

U.S. President Barack Obama nominated Hispanic Democrat Julian Castro, who is tipped for future political stardom, as his new housing and urban development secretary on Friday.

The move will equip the San Antonio mayor, 39, with Washington and cabinet experience that would be useful should he seek statewide office in Texas or even be tipped to serve on a future vice presidential ticket.

Castro, and his identical twin brother Joaquin Castro, a U.S. congressman, are regarded as great future hopes of the Democratic Party.

Democrats are keen to highlight the pair as the party seeks extend its dominance over Republicans among Hispanic voters in presidential elections.

If confirmed by the Senate, Castro will replace current Housing and Urban Development Secretary Shaun Donovan, who he has chosen to be the new director of the Office and Management and Budget.

Obama picked Julian Castro to be the first Hispanic speaker to give a keynote address at a Democratic National Convention in 2012, bringing him to national attention for the first time.

Americans "saw this young guy, pretty good speaker, not bad looking -- talk about how America is the only place where his story could even be possible," Obama said at the White House on Friday.

"And I watched, and I thought: That's not bad," Obama quipped, before going on to list what he said where Castro's qualifications for his new post.

"Julian's been focused on revitalizing one of our most wonderful cities, planting thousands of housing units downtown, attracting hundreds of millions of dollars of investment. He's built relationships with mayors all across the country."

Donovan will take over from current budget director Sylvia Mathews Burwell who appears to be on her way to confirmation by the Senate as Health and Human Services secretary.

Kathleen Sebelius, the previous Health and Human Services secretary, resigned following the troubled rollout of Obama's signature health care law.

[Image via Agence France-Presse]