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Page 25 OCTOBER 2015 • VOLUME 20 • ISSUE 6
Leaders agree: Austin is becoming less affordable for homebuyers By Riki Markowtiz
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Anyone who has ever been an Austin resident for any amount of time is certain of one thing: The city is experiencing a truly spectacular growth spurt. Austin’s expansion is so explosive, the city can’t build new roads or improve infrastructure fast enough. The influx of more than 100 new residents each day is causing a squeeze on housing supply and triggering home values to increase exponentially. Today, there’s not enough affordable housing (defined as housing deemed
affordable to those with a median household income as rated by the region) to satiate eager buyers as the value of existing real estate has increased so rapidly, Austin’s middle and working classes are getting priced out of the market – and out of town. This year, Austin was called the “city of cranes,” by The Architect’s Newspaper. The city topped Forbes list of “Where to Invest in Housing in 2015.” In an article identifying the hottest housing markets and markets with fastest home sales in the U.S., Realtor.com ranked the city number 13 and 17, respectively. Clearly 2015 is the year the world noticed Texas’ best-kept secret. But ask any REALTOR who’s been here during this most recent population surge and you will hear a narrative that’s not as cheery or as optimistic as screaming headlines imply. Austin is growing faster than any other city in the U.S., only behind behemoths like New York, Houston and Los Angeles. But limited housing availability means that the people who live here are being marginalized and priced out of a city they have called home long before recent settlers with larger bank accounts. “It’s almost impossible to spend less than $250,000 on real estate within the city anymore,” says Bill Morris, a director and chair of the legislative management team at Austin Board of REALTORs (ABoR). “As you get to lower price points, people are forced to move further and further away.” While Round Rock and neighboring Pflugerville may have nice schools, good restaurants, and sports arenas, that’s not why 25,600 people chose to move here in 2013 and 2014, but that’s where they’re ending up. Socar Chatmon-Thomas, a NAR government affairs committee member, has been tracking the MLS on a monthly basis. “I do a study of the houses and zip codes that have sold the most. Over the last five months, all of the top zip codes here have been outside of Austin. That’s because of affordability.”
Pricing out of the system Unless there’s some sort of housing-density and cost-relief solution on the horizon, some experts predict that after people start populating Austin’s border cities, businesses are sure to follow. Right now, lawyers, engineers, and high-paid tech workers can afford high housing costs, but those who labor a few floors below the C-suite have no chance of living in the city – not unless they already own property, will inherit property, or are okay with renting and can find an affordable lease. For the past few years, the median household income in the city has hovered at or under $50,000, an amount that Austin Business Journal says can conceivably qualify for a home valued up to $215,000. In March, ABoR reported that the average home in the Austin area was selling for nearly $335,000. According to a 2015 Real Estate Council of Austin (RECA) affordable housing report, “more than 60 percent of the 100,000 new jobs added in the Austin region in the last decade were in sectors that pay less than $45,000 a year.” ChatmonThomas, a past ABoR chairman, warns that city planners and developers may one day regret not acting fast enough, or at least lament over whether more could have been done. “More and more support staff – including secretaries and maintenance workers, as well as police and firemen – are living in bedroom communities like Kyle, Buda, and Hutto, and drive in to the city every day.” What’s to stop other companies from bypassing Austin altogether and settling in these Austin-adjacent towns?
Upcoming Events Saturday, October 17 NEW COMMUNITY: Bryson Grand Opening 11 a.m. to 3 p.m. - Leander Sunday, October 18 NEW COMMUNITY: Bryson Grand Opening 1 to 4 p.m. - Leander Wednesday, October 21 CRS Bi-Monthly Meeting 11:30 a.m. to 1 p.m. - Westwood Country Club Thursday, October 22 CTAMP Monthly Luncheon 11:30 a.m. to 1:00 p.m. Great Hills Country Club Wednesday, October 28 HBA Elected Officials Appreciation Night & BBQ Bash w/Special Guest Lt. Governor Dan Patrick - 6 to 9 p.m. Phillips Event Center Friday, October 30 ALREC Halloween Bash 9 p .m. to 2 a.m. El Sol y La Luna
Finding a solution “We have a huge affordability problem and a lot of it has to do with years and years of overregulation the city has imposed on the housing and construction industries,” says Geoffrey Tahuahua, vice president of public policy at Home Builders Association (HBA) of Greater Austin.
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