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FEBRUARY 2018 • VOLUME 22 • ISSUE 10
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Seller's market to continue for 2018 experts say By Riki Markowitz
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t this year’s Home Builders Association 2018 Housing Forecast there was a lot of good news for Central Texas real estate professionals. Some of the main highlights from the annual event include continued growth of home prices, historically low unemployment and an on-going population boom. Also noteworthy was recognition of Austin’s response to the area’s year-over-year growth and resulting need for housing. In the coming year, starts are expected to increase
to about 17,000 throughout the metro area, which is a 5 percent increase over 2017. Greg Hallman, a senior lecturer and faculty director at the Real Estate Finance Investment Center, McCombs School of Business at the University of Texas at Austin, said it “warms his heart” to see that as demand for housing goes up, the city is responding. For an idea of what happens when a city ignores its housing shortage, just look to San Francisco where the median square foot costs more than $1,000. In the Austin metro area, it’s about $150 per square foot and just over $200 within Austin’s city limits. At the annual breakfast conference, attended by more than 600 industry professionals at the AT&T Conference Center at the University of Texas, three housing and economic experts presented their analysis of trends, supply and growth in the housing and labor markets across the country. Eldon Rude, principal at 360º Real Estate Analytics, tracks U.S. employment trends. He said that major tech companies are continuing their drive for growth this year and that Austin has “emerged as one of a handful of cities most attractive to the industry for expansion.” Rude also points out that the unemployment rate here is historically low at just 2.7 percent, making the Austin metro area very attractive to a highearning workforce that will inevitably convert to 2018 homebuyers. This isn’t just speculation. Some of the larg-
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est tech companies in the world— Facebook and Google, for example—are expanding and have already signed leases for enormous amounts of office space and entire buildings around town. Additionally, companies with headquarters in Austin—HomeAway, Indeed. com, and Parsley Energy—have also signed leases for a combined million-plus square feet of office space. Specifically, Parsley will be occupying an entire 31-story downtown skyscraper and Indeed.com is moving into an 11-story tower at the Domain. While homebuyer numbers may look fantastic on the surface, to actually connect with this population it’s crucial to understand what motivates them and, as consumers, how they operate in the world. Lindsay Kunkle, vice president at Kantar Futures, identified three
major trends among likely homebuyers: they anticipate change, they’re inundated with brand marketing and they’re prone to retreating into small and intimate social and professional bubbles. Kunkle sums up her analysis this way: “In a world of changes, the mandate for business is to channel the forces of disruption or risk being disrupted.” And to reduce what Kunkle calls “brandwidth” overload, consumers are looking for convenience and “flow” so they can better manage their lives. How does that translate for the REALTOR? It starts with courage in the face of change. In other words, an openness to adopting new technologies and tools, awareness of new and more convenient ways of doing things and the
Front Page: Continued on page 28
Features of the Month Column: ABoR—ABoR Academy, February Town Hall & Tools for Your Business . . . . . . .pg. 3 Column: WCREALTORS—Are New Home Sales Disrupting the Wilco Market?. . . . . . . . .pg. 7 Column: HBA—Advantages to Selling New Homes . . . . . . . . . . . . . . . . . . . . . . . pg. 15 Column: Women's Council—My Crystal Ball for the 2018 Real Estate Market. . . . . . . . pg. 18 Column: RRC—Experts are Weighing In: Prices are Flying North for 2018. . . . . . . . . . pg. 20. Expert Commentary: I Really Wish You Hadn't Done That! . . . . . . . . . . . . . . . . . . pg. 22 Associates in Progress: Movement Mortgage. . . . . . . . . . . . . . . . . . . . . . . . . . pg. 25 Associates in Progress: Security National Mortgage Company. . . . . . . . . . . . . . . . pg. 27 Upcoming Events. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . pg. 33