Austin Real Estate Scene

Modest near-term movement is expected in Austin TX real estate sales, with a recovery in sales seen during the second half of the year, according to the latest forecast by the National Association of Realtors®.

Lawrence Yun, NAR chief economist, said some pullback after a sharp increase in the previous month was expected. “The overall decline in contract signings suggests we are not out of the woods by any means. The housing stimulus bill that is still being considered in the Senate is critical to assure a healthy recovery in the housing market, jobs and the economy,” he said.

Furthermore, Yun said location has never mattered more than in the current market. “Some markets have seen a doubling in home sales from a year ago, while others are seeing contract signings cut in half. Price conditions vary tremendously, even within a locality, depending upon a neighborhood’s exposure to subprime loans.”

Let’s take a look at the sales statistics for June 2008 to see how the Austin TX real estate market looks: Keep reading →

Studies indicate that over 80% of today’s home buyers visit the Internet long before seeking the professional assistance of a REALTOR®. This means that, thanks to popular realty-themed websites that compete for your business, you the client are already armed with more information than ever before. Often consumers are more educated about the market or area then the REALTOR®. That’s not a good thing for a Realtor.Realtors need become familiar with these kinds of sites and the features they offer. This data will not only prepare a Realtor to answer any questions a clients might have about homes, the market, schools, taxes, etc…

I like it when a buyer or seller is knowledgeable about the market and how a real estate transaction works. They are much easier to work with and are better prepared to deal with it. I’ll give them all the information they need to know.  Some buyers can’t get enough and others just want an overview. Some want none but I give it to them anyways.

Below are some websites that consumers can use to help them in their search and education on learning more about… Keep reading →

I subscribe to this newsletter, Herman Trend Alert about the trends happening around the world. I find fascinating to know what is happening outside of the Austin and Texas areas and how that can affect us here. Well this latest issue I found to be valuable in that it talks about the trends that are happening because of the economic crisis in the U.S. Austin is thankfully not getting hit hard like many of areas around the country, but I do think we are seeing the following trends happening here. I have a friend who works for a Toyota dealership and he said that the Prius are on back-order until next year. I guess people are getting serious about conservation.

Herman Trend Alert: Thriving in Economic Crisis        July 9, 2008

Some enterprises are thriving through this period of economic crisis.

First, the sales of fuel efficient, mostly small cars are booming. Toyota dealerships have only 15-days inventory of Corollas on their lots. In May, Honda’s modest Civic became the number one selling car in the United States.

Logistics alternatives to diesel-consuming trucks that are more efficient at moving goods, like railroads, are also doing well. Plus, fed up with increasing delays and cancellations of flights, passengers are choosing rail travel over air. Expect this trend to increase; the US rail lines will borrow experts from Canadian Pacific and Virgin to learn how to deliver extraordinary passenger experiences.

Domestic food producers, especially domestic cheese producers are reaping the benefits of the falling dollar. Rapidly rising prices for imported products are prompting customers to look for domestic substitutes. Farmers now find their products in increasingly higher demand.

Local amusement parks will also do well in these challenging economic times. The parks are enjoying the benefits of people taking what are called “staycations”—vacation time off taken close-to or at home. Until the economy improves, expect to see increasing numbers of people choosing staycations.

The National Sporting Goods Association (NSGA) reported that sales of bicycles, related parts, and accessories was about USD $6 billion in 2007, up from USD $5.8 billion in 2006. In 2008 and beyond, more people around the world will choose this earth-friendly mode of transportation in lieu of automobiles.

Another thriving industry category is the entire service industry around prosperity coaching, debt reduction, and financial counseling. “As costs rise faster than salaries, people are looking for relief”, said Belinda Fuchs, founder of OwnYourMoney.com. Fuchs is one of a growing group of professionals providing seminars and coaching to help clients “live debt-free and finance their dreams”. Our forecast: a growing demand for these services by cash-strapped consumers seeking answers.

And of course, no discussion of industries bucking the trend would be complete without mentioning the oil companies and their record profits. However, the country of Brazil is in the best of all positions—its surveyors recently discovered an area off-shore that may be the largest find in 30 years.

“From ‘The Herman Trend Alert,’ by Joyce Gioia-Herman, Strategic Business Futurist. (800) 227-3566 or http://www.hermangroup.com. The Herman Trend Alert is a trademark of The Herman Group of Companies, Inc.”

This is the letter that Mayor Will Wynn sent out a couple of weeks ago about the Austin energy efficiency issues with homeowners. A “green home tax” was being considered on Austin homeowners by the City Council. The City Council Task Force wants all Austin homeowners to get an energy audit but they don’t have to do the upgrades which could be expensive. Read the Mayor’s letter below and see what you think….

Mayor Wynn on Energy Efficiency
June 11, 2008
Dear Friend:

Over the last several months, you may have heard talk about a proposed City plan for achieving improved energy efficiency in existing homes. Some have called it the “point of sale” ordinance, or even the “green home tax.” There’s been a lot of confusion and misunderstanding on this issue, so I want to try to set the record straight. I hope that you will take a moment to read this.

Keep reading →

Unfortunately, the media’s continued focus on negative real estate news is not the whole story especially in Austin and this negative news is resulting in buyers missing tremendous opportunity by sitting on the sidelines. Here are some facts to consider if you are on the fence about purchasing.

Keep reading →

The Week in Review  for May 25- May 31, 2008
(compared to the same week in 2007)

• New listings down this week 9%
• Pendings (homes under contract) down 63%
• Solds down 37%

As for Average Prices: May 25 - May 31, 2008
(compared to the same week in 2007)

The “New Listings” average list price decreased 6.5% to $305,760.
In 2007 the new listing average list price was $326,900.

Sold average sales prices decreased 3% to $253,993.
In 2007 it was $262,100 for the same week.

Now let’s look of the The Month in Review for May 2008

Units (homes for Sale): (compared to May 2007)

• New listings were up 26%.
• Pendings were down 67%.
• Solds Units decreased by 28%.

As for Average Prices:
The “New Listings” average list price is down 7% to 314,100.
In May 2007 the average list price was $337,400.
Sold average sales prices increased 5% to $257,600
For May 2007 it was $245,600.

Current Overall Listings update
This time last year we had 9,800 active listings during the same week in 2007?
Right now there are about 12,250 active listings!
That is a 24% increase from last year. As always some areas have more inventory then others so contact me if you need to know about specific market area of Austin.

We see a lot of buyers and sellers who are wondering what’s happening to the market here and overreacting to what is going on in the national real estate scene. We still caution sellers to not overprice their property because while Austin isn’t in the doldrums like the rest of country, it is still not a strong market right now. We are just riding out the real estate storm from the rest of U.S. You always have to look at each individual neighborhood and see what the actual numbers show. For instance if everyone your neighborhood is putting their home on the market in the $300,000 range and you put yours up for sale at $350,000, well you know what happens right? You sit there and wait, and wait, and wait…etc…

Buyers are taking their time and looking for the best deals.There aren’t a lot of them but if you look carefully at the market you can find them. Interest rates are still low and with all the inventory in various areas buyers can be more selective about which home they want to try and buy.

The strongest areas of Austin that we see are in Central Austin and the weakest areas now are out in the Lakeway/Lago Vista. There are over 13 months of inventory out there while there is less then 4 months of inventory in Central Austin.

Here is the June 2008 Calendar of Events for Austin Texas:

My wife and I had our greenhouse/shed was profiled in the Los Angeles Times Home & Garden section today.

Here is the link for it. Sheds and hideaways like you’ve never seen before!

We are still seeing the rise of property values across Travis County.

Five Travis County School Districts are seeing Double Digit increases in their property values

The biggest increase in the Eanes school district which is going up over 15%. The other areas are Lake Travis, Lago Vista, and even the Austin ISD has shot up over 12%.

These increases in appraisals by the Travis County Appraisal District are going to draw controversy because they don’t correlate with the slowdown in the Austin real estate market this year. There is lot more inventory for sale then last year and it’s not moving as quickly. This could cause a downward trend in pricing if sales don’t pick up. I’m seeing a lot of price reductions on listings throughout all of Austin and the surrounding areas. This has many home sellers confused why the value of their home went up so much and they can’t sell their house for that amount.

Home values in Williamson County this year are expected to rise 6 percent on average and commercial values about 9 percent on average, Chief Appraiser Bill Carroll said.

In Hays County, Chief Appraiser David Valle said homeowners can expect to see single-digit increases on average when notices go out May 8 or 9. Commercial values probably will be up as well, Valle said.

Brown said the housing valuations in Travis County were based on “late 2007 sales whenever possible to make sure our values are accurate.”

Brown added: “People are continuing to come into the area. And as long as we have population growth and low interest rates, we’re going to have continued demand for houses. It’s when demand dries up that house prices are likely to go down, and a well-located house is still selling well in this marketplace. The demand is still sufficient enough to keep values increasing.”

We’ll see if that demand is sufficient enough over the summer. I think they are being overzealous in their appraisal approach and I encourage anyone who thinks their property values have risen too much to protest them. You must file your protest by May 31st. For more information on how to file your protest Click Here.

I wanted to give you some market statistics that we heard from the Austin Chamber of Commerce from a meeting we had this week.

• In the past ten years, Austin’s population has increased by 487,000.
• 1,000 persons per week are moving into Austin MSA
• By the year 2030, Austin’s MSA population is predicted to be 3.5 mil
• Williamson county has increased by 53% since 2004.
• Williamson county population is expected to be 1 mil by 2030
• 20% of jobs in Austin require a Bachelor Degree
• 42% of workers have a Bachelor Degree creating approx. 80K workers are underemployed
• Professional/Business Services have added the most jobs in the last 12 months
• Since 2000 Austin MSA has experienced approx 14% decline in Hi Tech jobs
• Hi Tech compensation has declined 7% since 2000. Private sector wages have increased 6%
• There are approx 3000 Hi Tech companies within the Austin MSA which comprise 33% of total payroll
• The average income for Hi Tech workers is $80K
• Residential building permits peaked in 2005
• Austin had an average of 4 months inventory of residential properties available for purchase in 2007. In 2008, this number has increased to 4.7 months. The nationwide average is 6 months, so Austin is below the average in respect to residential inventory.
• Austin is one of the nation’s biggest targets in Venture Capital.
• Austin’s MSA population is less than 7% of Texas’ population, but holds 48% of Venture Capital funding in Texas.
• 129 companies relocated to Austin since 2004
• 34 companies relocated to Austin from other cities within Texas. California follows in second with 29 companies relocating to Austin, and 17 companies have relocated internationally to Austin.
• The Chamber’s plan is to bring 72K jobs to Austin within the next five years
• And last, but not least………By the time you drive home this evening, there will be 84 more vehicles on the roads than there were whenever you went to work.