AREA OVERVIEW | Why Austin?

Number "ONE" best place to invest! (According to Smart Money Magazine: Categories used were jobs, economy, price, building permits, vacancies and population growth.

Third fastest growing city in the nation over the next 25 years! (Brookings Institute, January '05)

Value, Value, Value! (Investors are moving into Austin because experts see great value in home prices and predict increasing appreciation!)

Rated 3rd out of 150 top metro areas for best places for business and careers by Forbes Magazine, May 2005! (Austin achieved the #3 spot in America by having the following: High Number of advanced degrees, low cost of doing business, low cost of living, low crime rate, abundance of culture, leisure, and educational attainment, income growth, job growth and net migration.)

Ranked among the top four most loved cities - by Travel & Leisure Magazine!

Ranked #1 in the USA for best cities for relocating families in large metro area!

Ranked # 15 in best Retail Market in the US!

Ranked #4 in the top 20 next boomtowns in America!

Demographics: The age distribution of the local Austin population is heavily tilted toward the 20 to 34--age category.

Austin Economy: The local economy is now more closely tied to national demand because of the rapid expansion of the local computer and high tech industry. Texas ranks second nationally in terms of overall jobs. The states high-tech firms employ approximately 435,400, and Austin’s diversification and large state and federal government sectors, including the University of Texas provide economic stability.

The current economic situation is improving with strong job growth: A May 2006 report in Business Magazine ranked Austin No. 4 nationally for projected job growth among metro areas with at least 1 million residents. Local economist’s project over 20,000 new jobs per year for the next five years will occur in the Austin area.

Housing: Residential construction was up briskly in the last six months of 2006. Vacancy rates for rental properties fell in 2005.

Austin area home prices are below the national average: Prices were flat for several years as immigration fell, but the average home price has risen 11.5% in the past 12 months, and the medium sales price has increased from $166,800 in January of 2006 to $182,000 in June of 2006, suggesting a real estate recovery and the beginning of a growth market cycle.

Investment Risk: The longer-term economic prospects remain good as demand continues to rise and the best long-term strategy is to Buy and Hold.


Home Price Appreciation Comparisons


Let’s Compare Austin’s Appreciation Rate to the United States. Where do you think you want to start investing?

Typically, home price appreciation rates are calculated on an annual basis by comparing the current prices to those of 12 months earlier. By using this longer time span, it ‘smoothes out’ the month-to-month fluctuations and produces a more ‘stable’ rate of appreciation. However, when markets are volatile, this one year ‘average’ appreciation rate can also hide important market changes.

Quarterly home price appreciation rates are calculated by comparing current prices with those of three months earlier. This percentage rate is then multiplied by four (or ‘annualized’) to make it comparable with other annual-based figures.

Higher Prices and Continued Upward Momentum For Austin Texas

Are you looking to invest in the Austin area? This is an ideal time to be looking at Austin’s undervalued marketplace! Austin was recently cited as #4 in the top 10 Tech cities in the U.S. (WIRED magazine) and we see this positioning this college/tech centered city as ripe for further growth and continued influx of Real Estate investment. Not only that, but Austin’s market is expected to buck the trend across the nation with continued real estate strength and growth across the board. Add to this the amount of money being put into infrastructure with our recent 130/45 toll roads and tremendous highway construction–and you’ll agree Austin is easing one of the largest complaints against it–the traffic.

Here’s a bit from the Austin American-Statesman:

"December’s Multiple Listing Service report from the Austin Board of Realtors shows single-family home sales were higher than during the same period in 2005, capping another record year for the area housing market. Single-family home sales for the month were up 3 percent from last year, totaling almost 2,000, with the year-end total sold at almost 27,000, a 10 percent increase from 2005. Average days on market were 63 days, the lowest time span in four years. The number of active listings declined by 4 percent to just over 7,800, marking the lowest number since 2001."

Let’s look at some recent statistics, these being Average Prices for February: "New Listings" average list price is up 18.85% to 304,624. Sold average sales prices increased 7.72% to $238,092 compared to $221,025 in 2006.

Looking at the state of Austin, 4Site Partners opinion leans towards a sellers market as trending clearly shows Austin moving toward decreasing supply with prices and sales out-pacing their historic patterns.

THE AUSTIN MARKET AS A WHOLE:

Anyone looking for real appreciation in a market that defies the ‘bubble burst’ reverse trends we hear about in the coastal (big city) markets across the States should strongly consider Austin as a prime Real Estate investment.

4Site Partners continue to see a solid upward trend in Austin. This is a great times to sell as price appreciation is on it’s way up, but even better to get in on buying a home while there is time. Austin offers an exciting (undervalued) price scenario (Austin homes were recently ranked about 5% undervalued according to USA Today). The reason investors from abroad are considering the Austin real estate market as investment and personal ownership is because Austin has been unaffected by the market ‘bubble’ (in fact it has been undervalued the last 4 years) and promises strong growth with it’s improving infrastructure and continued investment by high tech companies, the most recent example of which is Samsung who are currently building an enormous headquarters in North Austin.

4Site Partners view the evolving state of the market currently very favorably: a tightening of supply after years of surplus is creating a more balanced buyer/seller market in Austin. Not only that, but we know that jobs in central Texas are up nearly 20,000 in the past year, and jobless claims are down slightly to 5.1% compared to 5.4% last year. The consensus is that the growth is broad based, and this can only mean good things for those that own property in Austin.

In conclusion, we have tightening supply and prices moving higher, this is what would be needed to continue to change our entrenched buyers market that Austin has experienced for the last 3-4 years. Add to this the recent occupancy/rental numbers, which usually mirror the home sales market that show a rising trend of rental prices and higher demand due to tighter supply (apartment constructions are significantly down).

Please fill in the following information and one of our real estate professionals will contact you shortly with more information.