SW Austin Current Market

[Aquitaine]

I agree with the last part - I think we have a year or two before rates go up (and last I looked, the Fed seemed to think that they'd be low through 2014).

I don't know about the rest. Old does not necessarily mean poorly maintained, and in many cases older homes have more character than newer ones, or at least the neighborhoods might. We looked at lots of places on Cat Mountain built in the 1980s that we really liked, but the only real candidates got snapped up before we got down there.

NW Austin seemed to be more expensive in general than SW Austin. I guess there's just more to do up there (Arboretum, Domain) even though SW Austin seems like it's catching up quickly.

[suit-n-tie white guy]

The older neighborhoods have the advantage of being paid off for the most part. This allows the owners to create a false scarcity as no one really HAS to sell. If they do they get a realtor. This is the bread and butter of realtors and this is why the realtors push the established neighborhoods as desirable to their clientele. This manufactured scarcity is leveraged upon itself to compound the rise in price by pressuring people into panic buying. Ever notice how realtors wont push a new build neighborhood unless they are allowed to sell there? The push it only if they can make money from it. In the end neighborhoods will see fluxtuation in price until they get the power to dictate their own scarcity to manipulate prices. Scarcity =/= Quality of life, but the perception of it.

[AustinGuy]

Originally Posted by Aquitaine

NW Austin seemed to be more expensive in general than SW Austin. I guess there's just more to do up there (Arboretum, Domain) even though SW Austin seems like it's catching up quickly.

IMHO this price difference has previously been driven by the the closeness to high paying tech jobs in the area, although in the last 5-10 years they've started to be more evenly distributed around town.

[TexasHorseLady]

Originally Posted by suit-n-tie white guy

The older neighborhoods have the advantage of being paid off for the most part. This allows the owners to create a false scarcity as no one really HAS to sell. If they do they get a realtor. This is the bread and butter of realtors and this is why the realtors push the established neighborhoods as desirable to their clientele. This manufactured scarcity is leveraged upon itself to compound the rise in price by pressuring people into panic buying. Ever notice how realtors wont push a new build neighborhood unless they are allowed to sell there? The push it only if they can make money from it. In the end neighborhoods will see fluxtuation in price until they get the power to dictate their own scarcity to manipulate prices. Scarcity =/= Quality of life, but the perception of it.

Not really - to most of this.

Older, established neighborhoods may have some people who have been there from the beginning, but as many or more people who have bought over the years and most definitely have NOT paid off their loans. We own in an older neighborhood (Barton Hills area) and have owned there since 1988. We are pretty much the only people on our street and adjoining ones who have owned for that long, and have watched turnover of almost all of the surrounding homes, several more than once.

As for new neighborhoods, I have helped clients purchase in them as well as in established neighborhoods. I've also had sellers who have bought in new neighborhoods and have had to sell before the neighborhood is complete who have had the devil of a time doing because the neighborhood is still being built out at the time they wish to purchase and they are in competition with the new builds. A responsible agent will point this out to their buyer client so that they can make an informed decision as to whether they feel that they will live there long enough to not be in this position when they sell. Their call entirely, but it needs to be an informed one. If you consider that not "pushing" a new neighborhood, so be it - I call it fulfilling my fiduciary responsibility to my clients to make sure they have all the information they need to make an informed decision.

I get paid either way, new build or resale.

[suit-n-tie white guy]

The ideal condition is to own outright and invest the rest. The second best scenario is to finance through a local credit union. We go to such pains to shop local but then we ship $15000 in interest payments each year to places like charlotte and nyc without thinking twice about it. If were trying to shop local then buying cups of coffee at Jo's were just paying lip service.

[suit-n-tie white guy]

Horselady if were considering housing as an investment then the saying goes that the profit is made in the buy. Established neighborhoods will always have more demand than supply and are limited by the purchasing power and/or willingness from the demand side. The opportunity to buy low was missed a long time ago. So when is the best time to buy a house as an investor? Really anytime if youre buying while the neighborhood is fresh and the overextended are getting booted out. This is the nadir of the pricing , at about 5 years old. These are where the good deals are. The houses still have shelf life and you dont pay new house prices. Is this the turnover thats happening? Are the ARMs resetting in desirable areas where previous owners had purchased at the peak? Consonense in a real world application with low rates are perhaps warping the market.

[llkltk]

Originally Posted by Aquitaine

I agree with the last part - I think we have a year or two before rates go up (and last I looked, the Fed seemed to think that they'd be low through 2014).

I don't know about the rest. Old does not necessarily mean poorly maintained, and in many cases older homes have more character than newer ones, or at least the neighborhoods might. We looked at lots of places on Cat Mountain built in the 1980s that we really liked, but the only real candidates got snapped up before we got down there.

NW Austin seemed to be more expensive in general than SW Austin. I guess there's just more to do up there (Arboretum, Domain) even though SW Austin seems like it's catching up quickly.

You mean like Milwood? That's some affordable housing right there. And before you claim that it is not NW Austin, it is west of Mopac. Thus, it is NW Austin!!!!!

[shmatbert]

I don't think the scarcity is fabricated. There are a large number of people who are moving to Austin each month and they all need a place to live. Many of them want homes that are "close in" but they don't have the $$ to buy in 78704 or similar zip codes. Also, for some, the schools in those zips are an issue. Additionally, there isn't much more room for close in new builds in SW Austin.

If you're not in a hurry, I say wait until you find one you really want and make your very best offer. Don't buy something you don't love just to "get in" if you don't have to.

[Aquitaine]

I was really surprised at how much more expensive, say, South central Austin was compared to NW or SW Austin -- we saw a @2300 sq ft brand new home off of South Congress (but pretty far down, just South of Ben White) that was $400k. It backed up to a brand new gated condo community but the street it was on was pretty typical south central -- mostly decently kept but much older homes and one back yard had some huge pile of shiny junk in it that had people pointing and talking about it. And the schools for that area were pretty bad.

Our realtor at that point was still allowing for the fact that we might really want something there, but he basically said (only more politely) that we would be paying a $60k premium to live in hipsterville. The house we ended up with in Circle C was also brand new, larger, nicer by maybe one notch, and had much better schools, all for $50k less.

Obviously living in closer to central Austin is more expensive, but it's not like that part of town was particularly convenient to a whole lot. You're still about 12 minutes from 6th st in no traffic (compared to 15 from our part of Circle C). I didn't think the premium was even close to worth it.

[suit-n-tie white guy]

The crowding will further gentrify 78748, 78745, 78747 amd other zips in the immediate area that have land to receive new build. They will have to bump up the price in these areas now for new build. I wouldnt be surprised to see From the 230s as the new baseline. The schools will improve tremendously as a result