Will Austin Home Prices Continue to Increase? (Cedar Park: new home, buying)

[Jimb82]

Austin home prices are around 450k for a 3400 square foot home in a good suburb close to the city. Everyone is buying these houses. It doesn't seem like the builders are having any trouble selling these houses. Is there a risk? I can't see prices decreasing anytime soon so I probably should move up now since my home has appreciated greatly.

[hts]

I certainly hope so!

And I just put my money where my mouth is, having recently contracted for an acre+ parcel in DS where I can build my new home!

[riaelise]

Where are you looking? Because you can find a 3000 sq ft home in a good suburb close to the city and not pay 450K. You can definitely find one in the 300s. It's also winter and the inventory is low. IMHO the suburban prices are only going to go up but so much at the moment..if you pay $450K, it isn't going to be $550K-600 anytime soon. I really don't see that type of urgency to buy unless a) you are pretty cramped in your current house, b) you really don't care for your house or neighbors and want to get the heck out while the getting is good, or c) some other compelling reason. I guess I'm rather gunshy with paying for a home at the top of the market if I don't have to. Sure, prices are going to rise but not stratospherically higher.

[10scoachrick]

Having just downsized by 40% footage and half the $ value, I'd advise taking a long hard look at any 'moving up'...unless you find a killer deal(Why would there be a killer deal in this market?). You'll pay more on the top end and that will offset your gains when selling. One big determining factor for us was property taxes,,,ours were cut almost exactly in half--nothing to sneeze at when the house was valued at $400K for tax purposes. Those dollars will never be recovered...so we are saving half of them NOW.

[RoadWarrior12]

Eh. It'll go up, but not the rocket ride we saw last summer.

I expect prices to outpace inflation by a point or two for the next few years.

[Jimb82]

Originally Posted by riaelise

Where are you looking? Because you can find a 3000 sq ft home in a good suburb close to the city and not pay 450K. You can definitely find one in the 300s. It's also winter and the inventory is low. IMHO the suburban prices are only going to go up but so much at the moment..if you pay $450K, it isn't going to be $550K-600 anytime soon. I really don't see that type of urgency to buy unless a) you are pretty cramped in your current house, b) you really don't care for your house or neighbors and want to get the heck out while the getting is good, or c) some other compelling reason. I guess I'm rather gunshy with paying for a home at the top of the market if I don't have to. Sure, prices are going to rise but not stratospherically higher.

Are you talking about Cedar Park?

[Jimb82]

I think in ten years it will be mid 500s.

[centralaustinite]

Originally Posted by Jimb82

I think in ten years it will be mid 500s.

Sure, but that is just basically inflation at work, no real appreciation.

[llkltk]

That's good enough for me!

[Komeht]

Originally Posted by Jimb82

Austin home prices are around 450k for a 3400 square foot home in a good suburb close to the city. Everyone is buying these houses. It doesn't seem like the builders are having any trouble selling these houses. Is there a risk? I can't see prices decreasing anytime soon so I probably should move up now since my home has appreciated greatly.

4 things going on simultaneously:

1. Interest rates remain at near historic lows.
2. Building lag from 2008 financial crisis.
3. Interest in Austin is peaking.
4. Core remains incredibly difficult place to build, escalating prices stratospherically and pushing would-be buyers out to fringes.

Only one of those things is likely to continue through the long term.

Look for housing markets to soften in the suburbs over the next few years - especially the extremely vulnerable outer suburbs.