Let’s take a look at a couple of Austin area subdivisions on opposites corners of the Austin Metro Area and see how each has held up during the downturn of the past couple of years. As reference, both locations are plotted on the map below. Teravista is in far NE Round Rock. Belterra is SW of Austin in Dripping Springs.
Both communities are fairly new with very good, modern amenities, pools and community centers. Both offer homes that would cost more closer in, so these are value driven (more/nicer house for the money) communities and home owners will generally be trading off a longer drive for the lower price (though Teravista has more jobs nearby). Both are located in good school districts. Both have homes that are, on average, about 3,000 sqft in size average (2,743 Teravista vs, 2989 sqft Belterra). Sylvia and I have sold homes in both communities.
This analysis is simply to see if one subdivision has held it’s value better than the other. Sellers have had challenges in both communities, but let’s look at the actual numbers and see how they’re doing.
Sylvia and I have now migrated from desktop computers to full-time laptops. I was a bit worried about doing this, giving up nice big monitors for smaller laptop screens, but so far it’s working out really well and neither of us are noticing any impairment or difference in our ability to accomplish computer related tasks.
I purchased each of us a Dell Studio 1555. This model was well reviewed and I picked mine up at Costco for almost $300 less than the Dell online price. I wanted to buy and use mine for a while before getting the second one, just in case. After giving it a thorough test drive, the Studio 1555 performed like a champ, so I ordered the identical model for Sylvia, getting hers for free by cashing in Thank You Points that had accumulated through use of our CitiBank Visa. (My accidental discovery of the existence of this trove of almost 20,000 accumulated Thank You points would be a good topic for another day – bottom line, if you download all your credit card expenses straight into Quicken, still take a look at the actual paper statement at least every year or so).
With the desktops, I had various cords and plugs, speaker wires, speakers, power cords, etc. running to a battery backup power center. It all took up a lot of space, used a lot of plugs and collected a lot of dust. With the laptop, I have one power cable plugged into the side of the laptop, and a usb plugged in for syncing/charging the iPhone. That’s it. The cordless usb mouse tops it off. No speakers, no monitor, no full size keyboard. I don’t even plug in the network cord because the wireless internet speed is plenty fast. Don’t even need the battery backup because with the larger 9 cell batteries, the laptops will run 8 hours unplugged. I feel more organized and less cramped at my workspace with the smaller form factor of the laptop, which provides a psychological benefit.
The rental market for houses in Austin is still slowly improving, climbing out of the huge dip we took after the tech bust and 9/11. For October 2009, average and median rents are both up about 1%, but homes are taking longer to rent, averaging 42 days on market compared to 38 a year ago in October.
This is a macro view though. In talking with other property managers in Austin, it’s not uncommon for some homes to be renting for the same or less than a year earlier, while others can do a bit better. It’s really a function of the number of competing homes and the location of the property. It took 45 days for me to rent a central Austin home in 78704 recently and we had to take $50/mo. less than a year earlier. Had I accepted large dogs and/or poor credit, it would have rented right away, so rental criteria is also a determining factor in how long it takes and the amount attainable.
October stats are listed in the chart below.
|Austin Real Estate Rental Market Update October 2009|
|Houses only (condos, duplexes, etc. not included) compiled from Austin MLS data|
|Sep 2009||Oct 2009||Oct 2008||Yr % Change|
|Avg $ SQFT||$0.72||$0.72||$0.74||-2.56%|
|Not Rented %||23.48%||20.39%||27.77%||-26.59%|
Let’s have a look at 2009 year to date through October, compared to the same period in 2008.
Anyone who spends a lot of time looking for addresses knows that the GPS systems and various online mapping softwares have errors and omissions. Newer neighborhoods, even those 3 or 4 years old, often don’t appear in GPS systems. Google Maps often doesn’t have these addresses either. Or my favorite, the GPS systems show streets that don’t exists such as the one a block away from me which would send a driver right through someone’s house because the GPS thinks the street connects through to the next block. As Austin Realtors, we encounter this anomolies much more often than the average person, and we know that most mapping systems, though generally reliable, are not 100% trustworthy.
My own home address is messed up. Granada Oaks was platted in the early 1980s, Then the eighties real estate bust happened, the subdivision went into foreclosure with the Resolution Trust Corporation, was eventually purchased by a single individual in the late 1980s, then purchased by a developer in 2005. My street was named “Sisquoc” in the original plat. The builder and developer thought “Sisquoc” was too hard to say and spell, so it was changed through formal process with Travis County to “San Lucas”.
The result of this is whenever someone is going to have to find our house, such as guests, a UPS driver, repairmen, etc., I have to go through a certain “how to find my house script” when providing the address. It goes something like this:
“The street name is San Lucas, and that’s what it says on the street sign, but if you’re going to using a GPS or mapping software, you have to use the street name ‘Sisquoc’ because that was the original name before it was changed to San Lucas, and none of the GPS or mapping software have the updated name”
What a hassle. I get tired of saying all this. So the other day, I decided to use the “Report a Problem” link at the bottom right of the Google Maps page. I clicked it and send the following message:
This information is from the Real Estate Center at Texas A/M newsletter. Tells what we already know, but I think the stats are interesting.
Texas metros, led by number one Austin–Round Rock, claimed four of the top five spots and nine of the top 16 in the 2009 Milken Institute/Greenstreet Real Estate Partners Best-Performing Cities Index.
Also making the list were Killeen–Temple–Fort Hood (2), McAllen-Edinburg-Mission (4), Houston–Sugar Land–Baytown (5), San Antonio (11), Fort Worth–Arlington (12), Dallas-Plano-Irving (13), El Paso (14) and Corpus Christi (16).
Austin–Round Rock was the first metro to ever be ranked number one twice on the index, the last time being in 2000.
But it doesn’t stop there. Nine other Texas metros made the top 25 out of the 124 smallest metros that were studied.
Those were Midland (1), Longview (2), Tyler (4), Odessa (5), College Station–Bryan (14), Texarkana (17), Waco (18), Laredo (20) and Abilene (21).
Leaders in this year’s index, which ranks U.S. metros based on their ability to create and sustain jobs, are all metros that succeeded in avoiding the worst of economic declines driven by falling housing markets and job losses in manufacturing and global trade.
Regional economic factors also strongly influenced the rankings this year, with the oil and gas sector, technology and alternative energy providing stability among metros in Texas, North Carolina, Washington and Louisiana.
Another factor helping Texas metros move up in the rankings is the state’s favorable business climate and its ability to attract jobs and corporations away from higher-cost states.
One thing a lot of people may not realize is how business friendly Texas is compared to other states. This is why we enjoy the inbound migration of so many businesses fleeing places like California, where regulation and high taxes are increasingly burdensome to business owners and employers. So, while things are a bit sluggish overall in Texas and Austin, we are doing comparatively well compared to other regions.
October saw a huge 31% increase in the number of sales in Austin over the same month last year. Remember though, Oct 2008 took a 28% dip from the year prior, so while this October did see a good increase in sales volume, due in part to the $8,000 tax credit program, we’re comparing a dreadful month one year prior to a turbo-charged market this year, thus the big swing. Nonetheless, brisk sales for October was not an unwelcome result.
Let’s take a quick look at the monthly home sales prices in Austin for the past 20 months.
You can see that May 08 and May 09 were both the peak sales prices in their respective years and that sales prices drop in the off seasons. This year is no different but our sales volume has picked up more than usual.
Let’s see in the graph below how October 09 compares in all the metrics to October 2008.