Thanks for your insight. The article was written from the perspective of investing in real estate in East Austin vs. other areas in Austin, and how the contemplated Land Trust idea, outlined in the Statesman article, might mess with normal market behaviors. It was written almost 5 years ago. The Land Trust hasn’t happened, but the idea isn’t dead.

Meanwhile, all the froth came off the top of the East Austin real estate market and it’s settled into what I think are probably correct values. I was right to keep my investors out of that frenzied area. For the record, I like East Austin. When I was young and single in Austin in the 1980s I lived in East Austin for a while. It’s changed a lot, for better or worse depending on who you ask, but it has it’s pluses and minuses just like all areas of Austin.

Steve

Now after I went off to college many of the older residents started to pass away and some of their houses became vacant or in a few instances a younger unproductive child or grandchild stayed in the home and became a neighborhood nuisance. But even with that it’s still not “bad”. I visit often and I still love it. However, there is much more traffic which I hate. There are a few negative issues that the neighborhood group is working on but nothing that makes the place so terrible or dangerous. I have lived in several other places including the suburbs of one of the richest counties in the US and there were several home break-ins in the 3 years my family resided there. Our neighbor had his bike stolen and several neighbors had their cars broken into. Unlike you, I have live in both types of neighborhoods. Today, evil is rampant everywhere.

Anyway, back to East Austin. My relatives still live in the neighborhood and own rental properties that rent well. As I said, I come back to town regularly and I have witnessed the massive numbers of whites buying homes in our neighborhood. It’s good and bad. I have personally witnessed that many of the whites are actually the trashy addition to the neighborhood compared to what I know existed in the past. And compared to the way my relatives tend to their homes. A lot of these people (the whites) never water their lawns, don’t maintain their homes well and park too many cars on the street. Furthermore, they are “ex-rated” as my grandmother says…not married, shacking up with their “baby daddy or partner” – totally against my upbringing. These type of folks are saying they moved from the suburbs so they don’t have to drive so far. Hmm, the suburbs are not so “perfect”.

The other terrible thing is the ridiculous rise in property taxes that has occurred in the area. It should be criminal. Some homes have risen in value by 150k in 10 years. One house that was valued at 100k in 2000 is now valued at 247k and this is not isolated. A few of my relatives tried to get lawyers but they couldn’t get anything changed because the whole system feeds the cronies that love to whine about welfare but they take their tin cans to the government offices and manipulate the system to get what they want. It’s all mind games.

With that said, African-Americans are not perfect and there are social ills in the community that exist due to many factors (oppression, racism, Jim Crow laws, ignorance, laziness and some of the people “give up”- they simply get tired of fighting the system and feel they always come up short). Also about the drug dealers: I have seen a few shady characters that weren’t in the neighborhood when I lived there. It’s only within the last 10 years that my childhood neighborhood has seen the likes of this gross behavior. But again it’s everywhere. Most “normal” people don’t like it and work hard to get rid of it. White neighborhoods have meth labs, pedophiles, crazy unsupervised kids shooting up everyone in their suburban schools, high-class prostitution, wife beaters, husbands (lots of CPA’s) stabbing up the whole family, crack and cocaine and I could go on and on. Same stuff, just dressed in a suit to camouflage the behavior.

I am a product of East Austin. I lived there from 1972 until 1996. I graduated from UT. I also have an MBA and I’m working on a MS in Engineering. My sister is working on her PhD. My sister’s husband grew up in East Austin and has BS in Computer Science. Neighbors around the corner are a family of dentists and professors. I have friends who are pharmacists, CPA’s, lawyers, etc that are all products of East Austin. US Trade Representative Ron Kirk is a product of East Austin. Not bragging, just saying.

Your article simply reflects a lot of ignorance and falsehoods. The notion that you have to be so “brave” to live in East Austin is utter stupidity. It’s the other way around – blacks are brave to live near ignorant whites (so many examples–here’s one: dragging another human being from the back of a truck until his head was severed: James Byrd US 1998). It so reminds me of the white person that snubbed me when I said I grew up in East Austin. Today I would say “back at you”. I’d find out what neighborhood they live in and I’d be sure to tell them I wouldn’t want to live by their kind. This article oozes with that white condescending air that always thinks that white is better and black/Hispanic is bad. It also perpetuates the mind game tricks—it’s “bad” until we want it. I am so glad I know better.

I would suggest that you stop downgrading neighborhoods when you don’t live there or personally know anyone who lives there.

Thanks for your comments. You’ve misinterpreted the point being made about East Austin. I am discussing it strictly from a real estate investment perspective, evaluating it from an economic standpoint, not judging its people.

The Land Trust issue is an economic issue that can affect the overall market value of homes in the area as it sets some homes on a different economic equation than others. Other factors that influence home values are proximity to downtown (obviously a positive for EA), school quality, crime and drugs, government housing, etc.

That those negative elements exist in East Austin is not a commentary of the people, it’s just a measurable set of factors to consider, and those are the things that an investor or home owner should consider if deciding to purchase real estate in East Austin.

I do understand your point of view and see how one cuold take some of the elements of this personally. That is not the intent of the discussion.
Steve

We can of course help you when you come visit in May. The best thing to do would be to send us an email or call and we’ll start from there.

Steve

Good luck with your house. I remember well how frustrating a remodel project can be.
You’re correct to be aware of and try to avoid “over improving” your home. The best way to avoid that is to find out what the “after repair” value of your home will be. Subtract from that what you currently have invested in the home, then add back what it will cost to complete your repairs. If the total cost exceeds the finished value you may want to re-evaluate your contemplated upgrades.

Sticking to kitchen and bath improvements usually brings the best improvement in value, provided the work is done well.

Contact us direct if you’d like a CMA done for you.

Thanks

Steve

Thanks

Austin does not = DC in this situation. The big difference is money. The District experienced a HUGE surge in income because defense contracting firms have been raking it in hand over fist, so suddenly many people at once were able to afford rehabbing close-in neighborhoods. (And hey, that may dry up and disappear soon due to the shifting political climate there, halting the incredible ‘progress’ that has been made over the past decade.) Other than people like us who move from overpriced areas and buy because we’re floored by the relative bargains available, Austin just doesn’t have an opportunity for that kind of monumentally sudden cash infusion. And if it does come, odds are good it will go. Look at what happened here in the early 1980s during the oil bust, and again in the early 00s with the tech bust.

That said, I think the infusion of folks from the East Coast who are stunned at the proximity offered by the Eastside could impact the way people here view the appeal and necessity of that drive from Pflugerville, Buda, Elgin or wherever people are living these days.

There is no reason to approach the East Austin real estate situation primarily from the perspective of investors. It is young families, young single people and empty-nesters who put a premium on downtown living that will keep the momentum going (and in my experience new retail will light a fire under everything. many people just don’t have the vision or patience to buy or move in until the promises have been fulfulled). Let the investors buy in Pflugerville.

> the land trust idea is too little and probably ten years too late to accomplish its goals, and at this point would be a bad idea.

I think you’re probably right. The amount of momentum already in play in East Austin seems unlikely to stop at this point. You make an interesting comment about “10 years too late”. We can only ponder and guess, but I wonder if things would be as they are today in East Austin if the land trust program had been implemented in the mid 1990′s and widely adopted by established residents. Perhaps the proximity to downtown trumps everything eventually, but I still have a hard time getting a grasp on what the effects would be of essentially creating two classes of property in an area.
Steve

Also, the Featherlite development might change the investment outlook if the commercial fills in. It’s hard to say what that will finally look like, but they’re starting at least part of it now. And the crime problem which in the past has been truly significant has diminished quite a bit. I used to see hookers and drug dealers on the street literally every day. Not often, now.

Either way, the land trust idea is too little and probably ten years too late to accomplish its goals, and at this point would be a bad idea (that’s speaking as someone who might even benefit). If the City has so much extra money to spend over here, how ’bout after-school programs for those kids in underperforming schools (they do suck, my kid went to them) or physical improvements like extending the hike and bike trail north of 12th street?

The market is transforming this neighborhood, not in the way that everybody wants, per se, but in ways that are an improvement. If the investor class can’t figure out why, well, then that’s why they call it the Invisible Hand. Best,