Archive Monthly Archives: May 2007

How to Protest Your Property Value at Travis County Appraisal District

Tomorrow (May 31st) is the last day to file a tax protest against the appraised value of your property in Travis County (and other Texas Counties as well) with the Travis County Appraisal District. I haven’t personally protested property values for several years because nothing I own has been over-appraised, but I did file many tax protests every year for many years when I managed rental homes for others. It was an additional service I provided as part of the property management. Over the years, I learned a thing or two about the process, which I will share below.

Filing the Protest
The first step is to file a protest. The appraisal district has protest forms available, but you can hand write it on a piece of paper and fax it in. It simply needs to identify you as the owner, identify the subject property, and state that you disagree with the appraised value and wish to protest. If you’ve waited till the last minute, it would be best to fax it and then send a follow-up copy by certified mail.

The Informal Hearing
Next, the Travis County Appraisal District will schedule what they call an “informal hearing”. This may be months from now. The purpose of the hearing is for you to present your evidence that the appraised value is too high.

I’m going to stop here and point out a couple of things. It’s important before you attend a hearing that you understand the fundamentals of what the Travis County Appraisal District does. They simply set the appraised value of your home based on what they believe to be the market value. The tax rate multiplied against the appraised value determines the amount of property taxes you pay.

The Appraisal District does not establish the tax rate. Your elected officials do that. You can’t protest the amount you are paying, or the tax rate. All you are protesting is the Appraised Value.

When you show up for the hearing, make sure you bring data to support your protest.
Read more …

Posted by Steve
9 years ago

Austin Real Estate Market – Sales Update April 2007

Average and Median Sales Prices are up 6% and 6.6% in April from a year ago. Average price per square foot is up 4% from $126 last April to $131 April 2007. The Austin market keeps chugging along at a happy pace, refusing to overheat but still outperforming most other parts of the country.

There are 18 MLS Areas that have YTD appreciation better than 10%. Most of those are closer in areas, as usual. 11 MLS Areas underperformed, showing YTD appreciation of less than 5%. Most of these areas are further out and/or East of Austin. There were a few areas that we generally consider to be very strong, such as Area W (SW Austin) and 1N (Northwest Austin) that were in the underperforming group. More on area breakdowns further below.

Austin Sales Stats April 2007
Previous Month and Year Comparison
All MLS Areas - Houses Only

 
Mar 2007
Apr 2007
Apr 2006
Yr % Change
# Sold
2161
2149
2015
6.7%
Avg List Price
$254,093
$261,624
$247,121
5.9%
Median List Price
$182,900
$189,900
$179,900
5.6%
Avg Sold Price
$246,685
$255,708
$241,346
6.0%
Med Sold Price
$179,500
$189,000
$177,320
6.6%
Avg Size SQFT
2099
2123
2123
0%
Median SQFT
1891
1954
1920
1.8%
Avg $ per SQFT
$118
$131
$126
4.0%
Avg Days on Mkt
65
57
59
-3.4%
Median Days on Mkt
35
28
32
-12.5%

Below is the Year to Date Jan-April 2006/2007 comparisons for the entire Austin market.

Austin YTD Sales Stats April 2007
Year to Date with Previous Year Comparison
All MLS Areas - Houses Only

 
Jan-Apr 2006
Jan-Apr 2007
Yr % Change
# Sold
7149
7420
3.8%
Avg List Price
$243,430
$255,183
4.8%
Median List Price
$175,000
$185,000
5.7%
Avg Sold Price
$236,746
$248,113
4.8%
Med Sold Price
$172,000
$182,000
5.8%
Avg Size SQFT
2103
2104
0%
Median SQFT
1910
1912
0%
Avg $ per SQFT
$113
$118
4.4%
Avg Days on Mkt
68
65
-4.4%
Median Days on Mkt
42
38
-9.5%

Below are the same stats as above, but with new home sales filtered out. I do this to see if new homes skew the true appreciation rate of resale homes either up or down. In this case, there is a slight difference, indicating that the new homes sold through the Austin MLS somewhat pull down the overall appreciation numbers.
Read more …

Posted by Steve
9 years ago

Pulte chips in $500K for new Dripping Springs School

Why would a homebuilder give half a million dollars to the local school district? Because new schools help home sales. Belterra’s new elementary school, “Rooster Springs Elementary”, will open next fall, and it was surely a selling point for the last two homes we sold there. For the Highpoint subdivision in Dripping Springs, being able to tell families that there will be a new elementary school nearby will help boost interest in the neighborhood.

Hightpoint still has a long way to go until it’s built out. Pulte sold off a number of lots as well as two of its model homes to Wilsher homes, so now there are two builders in Highpoint. I heard from a custom builder that some of the bigger estate lots might be sold to individual customer builders but I haven’t been able to verify that.

Here is a stort about the Pulte donation toward purchasing the land for the new school.

Homebuilder ponies up $500k for Dripping Springs school
Austin Business Journal – 1:31 PM CDT Thursday, May 24, 2007
The Dripping Springs Independent School District is getting $500,000 from Pulte Homes Inc. to help purchase land for a new school in the fast growing community southwest of Austin.

DSISD wants to buy a 49-acre tract on Sawyer Ranch Road to construct a new elementary school. The balance of the $1.85 million price on the property will come from school district funds.

Pulte is making the donation in an effort to help build up the education infrastructure in an area where its highly active. The company’s Highpointe of Dripping Springs project is a 740-acre master-planned development that will eventually include 1,000 homes and has already sold 227 homes since June 2005. Home prices in the development range from $250,000 to $500,000. A number of other residential communities have been announced in the last year, setting Dripping Springs up to be one of the next prominent growth areas in the region.

“The new school will be in a great central location,” says Brent Baker, vice president of land acquisition for Pulte. “It’s right off [State] Highway 290 and close to where families are choosing to live. As this area develops, we want to make sure Dripping Springs is able to manage that growth.”

Bloomfield Hills, Mich.-based Pulte Homes Inc. is a Fortune 150 company with operations in 53 markets and 27 states.

Posted by Steve
9 years ago

Austin Apartment Rental Market Still Going Strong

Apartments somewhat mirror the Austin residential real estate rental market (houses and duplexes), though not always directly. A weak apartment market, such as that which occured in Austin from 2002 through 2005, hurts the rental market for homes and duplexes. Renters who would normally not rent an apartment can’t resist the free rent and other incentives that the apartments will provide when they demand falls. I had a tenant who rented a duplex from me in 2002, saying he couldn’t wait to get out of his apartment. A year later, at renewal time, he turned around and moved back into an apartment, even as I offered to lower his rent. He said he was getting 3 months free rent on a 15 month lease, plus a free washer and dryer and paying only a $50 deposit. I couldn’t compete with that.

Here is an article below from today’s Austin Business Journal about the Austin Apartment market, which is doing very well now, which means our homes and duplexes should continue to do well also.

Austin Business Journal – 1:56 PM CDT Wednesday, May 23, 2007
Gains in occupancy and rental rates continue to paint a positive picture in the Austin apartment market.

The local market saw occupancy creep up less than a percentage point in April to 93.38 percent — the highest occupancy level of any of the major Texas markets, according to a new report from Texas real estate services firm O’Connor & Associates. Average rent per unit rose $2.05 in April to $794.23. The month also saw the absorption of 77 units for a total of 1,907 in the last 12 months.
Read more …

Posted by Steve
9 years ago

Austin unemployment reaches 6 year low at 3.2 percent

Austin unemployment is almost too good. When I attended a local economic a couple of months ago, the economist from Angelou Economics warned us about the unemployment rate getting too low. I think it was 3.5% at that time. At the current rate of 3.2%, he told us it can start limiting the ability of companies to hire the new employees needed to grow and sustain operations, and you also start seeing more job hopping as employers compete for a limited labor pool. The last time it was this low was in 2001, just before our economy and real estate market in Austin took a dive.

How does employment affect the real estate market? Austin businesses will have to start recruiting more employers from outside the region, which brings in more home buyers and renters. No fuels the real estate market as directly as job growth, and we have very healthy job growth in Austin at this time.

Read more about it in the article from the Austin Statesman is below.

Region’s jobless rate hits six-year low
Unemployment in Central Texas at 3.2 percent, job growth strong and steady.AMERICAN-STATESMAN STAFF
Saturday, May 19, 2007

In the past month, Frank Venditti has run more than 10 newspaper and online help wanted ads looking for a carpenter and painter.

Venditti, who started Venco Construction Ltd. 18 years ago, says the past two years have been the best ever for his company, which repairs fire and water damage.

But so far, only a couple of applicants have showed up to interview.

“I get a bunch of calls, but maybe one out of 20 will show up,” said Venditti, general manager and owner of the company. “There’s a lot of demand for labor right now, and the guys who come in, they know that.”

The Central Texas job market is tighter than it has been in six years. The unemployment rate last month fell to 3.2 percent, down a full percentage point in the past year and the lowest since February 2001, according to Texas Workforce Commission figures released Friday. Meanwhile, job growth has been strong and steady, with a 4.4 percent rate last month.

That’s left employers with a tougher time finding workers, while job seekers hold the advantage.
Read more …

Posted by Steve
9 years ago

Austin Real Estate Market and News Journalists

The article below is from today’s Austin Statesman. I’m still amazed at the choice of words and phrasing used by newspaper journalists when writing about the Austin real estate market, and how they often focus myopically on “number of sales” when interpreting ups and downs of markets. Let’s look at a few examples.

First, the headline of the article:
“Central Texas home market rebounds in April”

Rebounds? The word “rebound” implies that there was a sudden or unexpected drop, or fallback in the strength of the market, which in fact there was not. The number of sales for Jan-Mar 2007 over Jan-Mar 2006 decreased by a total of 0.5%, while average sales prices rose 3.7% and median sales prices rose 5.3%. The breather in growth of number of sales was expected and predicted based on the torrid pace of home sales in Austin throughout 2006, as our market woke up again in 2006 and pent up activity was unleashed.

In fact, we already know, or should know, that the total number of home sales in Austin for 2007 is likely to be less than it was in 2006. So, next January 2008, even if Austin enjoys 9% overall value appreciation in 2007 as we did in 2006, we’ll probably see a newspaper headline that says “Austin Home Sales Down for 2007”, which will be an inaccurate and lazy headline assessment of the true strength and vitality of the Austin real estate market.

Next, the sub-headline:
Six percent increase comes after 3 straight months of drops, bucks national trend

A more accurate statement would be “Market Continues to be Strong and Steady as Predicted”.

Next, the lead sentence in the article:
After several months of flat or declining sales, Central Texas’ existing housing market rallied in April, regaining the momentum that led to a record 2006.

Wow, only a journalist could lead off a real estate article in Austin Texas, one of the most vibrant and exciting real estate markets in the country, with so much bi-polar manicism, as if we nearly slipped off a cliff but have miraculously “rallied” our way back suddenly. One would think from reading this type of reporting, that the Austin real estate market is on a roller coaster ride. It’s not. We are steady and strong, doing well and avoiding the hyper-appreciation that happened in other parts of the country that are now truly in a real estate slump.

Finally, to finish off the article, more bad news:
The Austin area hasn’t been immune to the national subprime woes….From January through April, existing home sales in Central Texas declined in all price categories below $130,000, and mostly by sharp double-digit declines, the board’s figures show.

Texas in general and Austin specifically had far fewer subprime loans than the parts of the country that generate the subprime loan trouble headlines. A more accurate statement would have been “Austin not as hard hit by nationwide subprime lending problems”.

The reason home sales are down in the lowest starter home price ranges is that so many renters have already purchased homes in the past few years – yes, in part due to easier loan requirements, but not nearly to the degree seen elsewhere. Demand in that segment of the market has largely been filled, and the starter home price range will start moving up into the $130,000+ range, natuarally leaving fewer sales below $130K. New people moving into Austin are not starter home buyers, but are coming here for better jobs and lifestyle reasons. Also, as land values and construction costs have risen in Austin, it’s not easy to build new homes priced below $130K anymore, so of course there are fewer sales in that range. Many of the builders who downshifted into lower priced homes during our 5 year slowdown, have shifted back now to higher price range homes as the demand for those homes is increasing.

My message is, as we read newspaper articles, which I do love to read, we must do so knowing that the journalists insert their own nuances and twists into the data and often paint a less than accurate picture with the way they word and phrase the facts. Rarely do they offer any real analysis or deeper digging into the numbers and what they mean.

Central Texas home market rebounds in April
Six percent increase comes after 3 straight months of drops, bucks national trend
AMERICAN-STATESMAN STAFF
Saturday, May 19, 2007

After several months of flat or declining sales, Central Texas’ existing housing market rallied in April, regaining the momentum that led to a record 2006.
Read more …

Posted by Steve
9 years ago
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