Pat, you win “quote of the week”. You’re exactly right.

Steve

Good points about the opportunity cost of time as it relates to the value of downtown living and the HOA fees and services.

Yes, as you contemplate what life will be like for your kids, you might have to leave a bit of yourselves and your preferred lifestyles behind, if you follow the path the me and Sylvia (and countless other parents our age) followed.

That’s not to say that raising a kid in 78704, or a downtown condo for that matter, deprives the kid or the parents of joy, but there are in fact practical social matters and schooling decisions that become more difficult to manage.

In our suburban setting in SW Austin, my 7th grade daughter has 6 friends and classmates within a 3 block radius, and her social interaction with those friends is an extremely valuable and important part of her life. It would be hard to provide that for her if we lived elsewhere since she’d have few neighborhood friends. Same issue for people we know who choose to live on acreage 20 miles west of Austin. Play dates are hard to arrange, birthday party attendence requires an “in town” venue, friends don’t just pop by for a visit, etc.

Steve

Thanks for your excellent contribution.

> the very counter-cultural values that made the area so desirable are now forced to move out,

Case in point, Terra Toys, which was a S. Congress “original” from the grittier days, but eventually was priced out and relocated to Anderson Lane, of all places.

Gentrification happens in the commercial realm too. The pioneering storefront warriors come into a scrappy area for the cheap rent, attract a motley clientelle, create something interesting and unique (perhaps by accident), then no longer can afford what they created. Then pricier, perhaps better run establishment co-op the vibe and bring the next generation of “cool” to the masses.

Steve

I have given the same subject much thought, and can’t help but to be similarly conflicted. Let me briefly address the difficult issue of gentrification.

South Austin really is the cultural and ideological epicenter of Austin (shared closely with 78705′s UT presence, 78702′s hip affordability, and more historically with 78751 and 78703′s aging and very lucky hippies; not to mention honorable mentions for East-of-Mopac ’31 and neater-than-ever ’56 and ’57).

You do a great job of outlining the highlights of 78704 so I’ll assume this audience is aware of the specific cultural highlights of the area.

What is interesting to me as a Realtor that (tries whenever possible to) sell property in the area, 78704 is one of those few neighborhoods that people necessarily choose to pay a lot more to live in than other neighborhoods.

In economic parlance, this is “adverse selection” (which also explains why you’re likely to pick up a loser when visiting a singles bar, and why most restaurants in Times Square are horrible).

Specifically – why would someone spend $1100 for a 2 bedroom duplex in 78704 when they could rent a 3 bedroom house for the same amount just a few miles away? Why choose less square footage, older construction, a smaller yard, and more “funkiness”?

Of course the reason is related to brand affiliation; the importance people put on the value of living close to like-minded people in an increasingly Internet-differentiated society, as well as the value of place (or in oenophile terminology “terroir”).

Perhaps this is unfortunate to say, but it is also a factor of education and economics. Those that don’t “get it” surely also consider those that willingly pay 78704 prices deserve their shoddy accomodations. They’re probably wealthier at the end of the year too from having paid more commodity based prices in outlying areas. It would suck making $50,000 a year and having to live in Manhattan, but who would doubt that the same Manhattanite could live a life of unparalled pleasure making $1M a year? Who gets the last laugh we’ll never know.

What we do know though is that people that do find themselves neighbors with others in areas like ’04 share cultural, intellectual, political, and socioeconomic values with their neighbors.

This feeling of community feeds on itself over time, breeding increasing pride and (somewhat amusingly I have to say) – increasing property values, as the premium for self-identification becomes increasingly a benefit of those few that can afford it. Artists, hippies, musicians, and others that have inspired the very counter-cultural values that made the area so desirable are now forced to move out, and like Berkeley, the Upper West Side, the Mission District, and the whole city of Boulder.

Sadly, economics have obligated me to increase the rent on and move out many such 78704 tenants on my own properties and those of my clients. Well, I’m not really sad about it on a case by case basis – artists are famous for paying rent late – but I do recognize the irony and bordlerline hypocrisy of my actions.

I just came back from visiting friends in West Hollywood, and despite having a median home price of over $1M there, the CA property tax rate is fixed at 1% of the owner’s original purchase price. This means that because property tax values are slow to become overly onerous and therefore encourage the relocation of lower income residents – gentrification happens slower than in Texas.

In Silverlake, for example, it is very common to see a recently-emigrated Honduran family renting next to a gay couple and their dogs, next to an elderly couple that have lived there for decades.

Alas, 78704 will continue along this path, becoming increasingly a playground for those that can afford to live here.

Luckily that is not a bad thing for the people who do live here, as the eco/tech-aristocracy needs a place to live.

But this high tax and high barrier to entry area will over the long term crowd out those that made it ironically what a great place it is today, and how that ultimately impacts the community will be interesting to watch unfold…

As to specific costs of downtown living, it has to take a different real estate mindset. The price per square foot is so much larger than other places (though sounds like 78704 is in the ball park per square foot), but you learn you don’t need the space because you are never home and hotels are very close if you need to have guests. When I lived in my first house in the suburbs my weekend mornings were filled with yard work, Home Depot visits, and maintenance tasks which included cleaning a 1500 foot home. Since I’ve lived downtown (5 years now), that time is now free time though we do have to clean the condo it is much smaller than the home.

In addition the HOA goes to other things like lower personal insurance (some of the buildings downtown replace to spec meaning they’ll rebuild and reappliance for you so you just need renter’s insurance for your stuff), someone at your building to sign for UPS packages when you are work, and to hold your mail/newspapers, free simple home repairs (leaky sinks, etc). Is it worth an extra $200 month or so to gain the 10 hours of precious weekend time? For us it is, but others maybe not.

Annyway, again not arguing parts of town better or worse, just enjoyed the contemplation your post entailed.

In return, give the property owners in those designated areas tax breaks to compensate for the larger risk they are being forced to take. Candidate areas could be around lamar and burnet up north (say 45 street up to 183), so co down south, second, fourth and 6th streets (downtown and the garden district) would all be good candidates.

These areas already have local businesses so the zoning wouldnt have an immediate impact, but as those areas become more and more popular it will prevent the chains from coming in.

The airport is a great example of how well this works.

I’m intrigued about living in a downtown condo as well, but I have a hard time accepting the high HOA and maintenance fees that would come with it. An old house in 78704 still works out to be cheaper in the long run, though less convenient if someone really does want to be downtown to enjoy all it has to offer.

Steve

I know it is only slightly related, but I was thinking this morning about now nice mopac is as a freeway–very few bill boards, no semis, very few wrecks and parts of it are goregous north and south of the river. If I were a realtor I’d go out of my way to never drive on 183 or I35 if I could help it.