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and another thing, at $110k, $8000 tax credit actually would make a difference.i expect to see comparable prices in s.e. wis. by fall,but there may not be a rebound in factory work by then. if ya'll buy a couple 3 phase transformers and a regulator or two it will help.
- DYeh
- Contributions:218
What a deperate call from RE agent!
Austin market had just started to tank. The RE peak in Austin as in 2007~2008. Dell just layoff mass people yesterday and today. Spansion filed bankurptcy recently, Google shut down Austin office, AMT are on no pay shut down rotation monthly, Freescale had already layoff large portion of their workforce. All the ARM mortgages during the Austin bubble of 2003~2008 are starting to due for rate hike. The Austin RE Market will continue to dive for a while. This is definitely not a time to buy. If people buy now, it can fall and lose money with the market. The rate can always be refinanced if you a buyer locked into a higher rate...but if a buyer lose a lot equity by buying into Austin market now, there is little chance to recover from the equity loses.
Austin market had just started to tank. The RE peak in Austin as in 2007~2008. Dell just layoff mass people yesterday and today. Spansion filed bankurptcy recently, Google shut down Austin office, AMT are on no pay shut down rotation monthly, Freescale had already layoff large portion of their workforce. All the ARM mortgages during the Austin bubble of 2003~2008 are starting to due for rate hike. The Austin RE Market will continue to dive for a while. This is definitely not a time to buy. If people buy now, it can fall and lose money with the market. The rate can always be refinanced if you a buyer locked into a higher rate...but if a buyer lose a lot equity by buying into Austin market now, there is little chance to recover from the equity loses.
- C West, "Cwest2"
- Contributions:63
Job being created at small companies are outpacing the layoffs at the few remaining tech companies. 42,000 people are moving to Ausitn every month: that wouldn't happen if there weren't jobs for them. About 2/3 opt to rent, the other 1/3 are looking to buy homes. The latest monthly stats are in: sales volume is dowm 30% from 2008, prices are up 6%. Fewer buyers and fewer sellers. Builders can't get financing, so in the next 6 to 24 months the housing shortage will drive up prices. Austin isn't California or New York: prices will follow the historic 3 to 4% appreciation in the long run. For those who fear "losing" equity while ignoring the tax deductions, and reduced auto insurance premiums accruing from home ownership, paying a landlords mortgage is always an option.
- C West, "Cwest2"
- Contributions:63
In April 2008 some buyers wanted to wait before owning their first home because they believed housing prices were going to fall. At the time, the median housing price in Austin was $186,000. In Feb 2009 (the latest month available) it's $189,900 (see chart courtesy ABOR). While 1 month by itself does not indicate a trend, it does contradict the myth that housing prices in Austin are falling.
Why is there so much confusion? In general, consumers respond more to negative news, so that's what's reported. Spansion is just one example. Many may have heard about the layoffs in February. But how many know these were part of a required reorganization before filing for Chapter 11 protection on March 1? How many have read that Spansion is now a leaner company and gaining market share? A recent survey by Manpower Inc of Austin area employers shows that 17% plan on hiring in 2009, while 10% plan on cutting jobs. If you do the math, that translates into more jobs not less. This is a significant fact that goes unnoticed when the national news is filled with doom and gloom. (part 1)
- C West, "Cwest2"
- Contributions:63
(part 2) Austin is also fortunate in that 42,000 relocate here every year. Some are retired or have internet based businesses: they can live anywhere, but will now be spending their money in central Texas. Local hiring and relocations are key components that drive housing prices. Another factor is financing, which probably has an even greater effect. Lenders are more strict today than 3 years ago. About half of all the potential first time buyers cannot get financing. Reducing the number of entry level buyers, has a ripple effect on those who purchased a starter home 5 years ago and are now ready to move up. Sellers will simply choose to wait another year if they are convinvced we are in a buyer's market. This is seen in reduced sales volume, down about 30% from a year ago. Cumulatively, these factors are keeping Austin housing prices stable.Should you buy or wait? It all depends on your situation. A good rule of thumb is this: it you plan on staying in the home for at least 4 years, then buy. If you don't, then keep renting.
- C West, "Cwest2"
- Contributions:63
I work mostly with first time buyer's in the $100,000 to $200,000 price range. Here are the latest facts (04/04/09) for these buyers: Current Active Listings 1860, Pending 822, Sold (last 30 days) 472. We have about 4 months inventory on the market. 6 months inventory is considered a true buyer's market, so we are leaning in that direction. First time buyer's are looking for 2 kinds of homes: pristine or bargains.Those looking for a ready to move in home will be pleasantly surprised at current inventory. Sellers know it's a competitive market and are painting and/or remodeling first. And they are more willing to pay for the buyer's home warranties and closing costs. Resale homes are in the best overall condition that I've seen in 4 years.Bargain hunters who don't mind a little painting are finding dozens of foreclosures being offered at substantial discounts. They view the bank's loss as the buyer's gain.
For those ready to buy now, this is a very good market.
For those ready to buy now, this is a very good market.
- C West, "Cwest2"
- Contributions:63
Those of us who have lived in Austin long enough remember the tech bubble of 2000 when Dell was over hiring, then 2 years later had massive layoffs. Accompanying this were layoffs at Motorola (now Freescale), AMD, Samsung, Austin Semiconductor, and smaller tech start up companies. Combined, these caused a MASSIVE drop of about 2 % in housing prices.
Austin does not have "bubbles" in housing prices because there is adequate space for builders to meet demand by increasing inventory which keeps prices in check, By definition, if there is no "bubble", there can be no "burst".
Also, no government since the great depression has increased the money supply as fast as the current treasury is about to. Most economists will tell you the greatest threat now is inflation. And the 2 best hedges against inflation are gold and real estate. For those who disagee, I know several landlords who would be glad to have you pay their mortgage by leasing one of their properties.
- HomeSand.net, "White Picture"
- Contributions:4395
Well.... you hurt my feeling.
- NTETS, "Mr Caveat"
- Contributions:6436
guy, dont ask q's and then answer them...
there is a word for that:
there is a word for that:
- C West, "Cwest2"
- Contributions:63
FYI I found this link posted today by Gregg Klar:
PMI's Home Price Correction Risk Ratings
It ranks the 50 largest cities by risk of home price corrections.
PMI's Home Price Correction Risk Ratings
It ranks the 50 largest cities by risk of home price corrections.
- daveyjones2007
- Contributions:469
Clint, Austin has had its fair share of housing busts. Ask anyone that was around during the S&L crisis. There was even more available land back then, and developers built the crap out of it. Dallas was brutal as well, another city with plenty of open land for builders to "keep prices in check." No offense but that thesis of yours is a bit weak.
Also, I don't know what stats you're looking at for 2000-03, but I think you'll find that "existing" home prices fell a lot more than 2% during the tech crash. Residents in central areas told me the drop was 20-30%, although it had fully recovered by 2006. The fact is, you can't lose a big whack of high paying jobs and expect prices to remain steady. Small business jobs don't pay anywhere near enough to compensate.
I hope the lower end is affordable enough that Austin will do okay in the next few years, and I wish you the best in serving that market. It looks to me though that the high end is headed for another big dive.
Also, I don't know what stats you're looking at for 2000-03, but I think you'll find that "existing" home prices fell a lot more than 2% during the tech crash. Residents in central areas told me the drop was 20-30%, although it had fully recovered by 2006. The fact is, you can't lose a big whack of high paying jobs and expect prices to remain steady. Small business jobs don't pay anywhere near enough to compensate.
I hope the lower end is affordable enough that Austin will do okay in the next few years, and I wish you the best in serving that market. It looks to me though that the high end is headed for another big dive.
- Chelsy_
- Contributions:480
I believe north Dallas TX is the only place to buy now.
- C West, "Cwest2"
- Contributions:63
I can't speak for Dallas, but in Austin we have a oversupply (12 months) of homes in the +$1,000,000 range. That's the one sector of Austin getting hit hard right now and it's dampening statisitcs for the rest. That's too bad, since the lower you go in price range, everything is stable which is rermarkable considering we're in a recession..
- C West, "Cwest2"
- Contributions:63
Daveyjones2007: You seen like a nice fellow but your information is anecdotal. I rely on tamu.edu which archives statistics from all Texas MLS systems going back to 1990. At the height of the tech bubble (last 3 months of 2000) there were 4,099 homes sold in Austin with a median price of $149,000. For the same period in 2002, 4,284 homes sold with a median price of $150,600. I stand corrected in that prices did not decline 2%, they rose 1%. Most of the negative comments I'm getting are coming from people who are not ready to buy, or can't qualify. I guess they figure if they can't buy a home, then no one else should. Fine, keep paying your bills on time and in 6 to 12 months you may qualify. Just don't expect prices to be lower than they are today. And don't expect interest rates to stay at 5%. I'm on your side. PS What's so great about paying your landlord's mortgage instead of your own?
Austin is completely immune from the 600000 job losses each month, and declining GDP as well. Should this economic crisis, which is not the longest recession since the great depression continue, Austin will be completely immune forever...
"most of the negative comments... are coming from people that are not ready to buy, or can't qualify"
Sorry chump, I own, and can buy 10 homes...
"most of the negative comments... are coming from people that are not ready to buy, or can't qualify"
Sorry chump, I own, and can buy 10 homes...
- C West, "Cwest2"
- Contributions:63
You really are a pessimist. Depending on whom you believe, we are in the 9th or 12th month of recession. How long do you expect it to last? It must be frustrating having to wait for lower end prices to drop so you can buy dirt cheap. Could it be you have one of those +$1,000,000 homes that aren't selling? . Explain to me, Sherlock, why prices are stable in Austin while dropping 20% nationwide?
- daveyjones2007
- Contributions:469
Clint, I get that you're a salesman but this isn't really a forum for realtor promotion.
I don't think it's too difficult to predict that central Austin is going to fall fairly hard but I guess we'll have to check back in a year or two (I'm talking about 78703, where you can't get anything decent for less than $500k). You can see it already in the number of ads that start with "Reduced!" Inventory is exploding and sales are non-existent. A frightening number of the best jobs are disappearing.
Anyway have a look at this. One of your fellow agents seems to have a less positive view on the Austin data: http://www.escapesomewhere.com/austinblog/2009/03/austin_real_estate_stats_feb09.html
I don't think it's too difficult to predict that central Austin is going to fall fairly hard but I guess we'll have to check back in a year or two (I'm talking about 78703, where you can't get anything decent for less than $500k). You can see it already in the number of ads that start with "Reduced!" Inventory is exploding and sales are non-existent. A frightening number of the best jobs are disappearing.
Anyway have a look at this. One of your fellow agents seems to have a less positive view on the Austin data: http://www.escapesomewhere.com/austinblog/2009/03/austin_real_estate_stats_feb09.html
- C West, "Cwest2"
- Contributions:63
Davey let's talk about 78703 where prices are falling. For the first 3 months of this year 26 homes in this area closed compared to over 3000 in the Austin Market. That's less than 1% of the total volume. But it doesn't make their situation any easier. I feel for anyone going through difficult times. I'm railing against misinformation that's keeping people with stable jobs in apartments which I believe are a complete ripoff. Those buying a $120,000 starter home and putting 3.5% down can take the $8,000 tax credit and use it to pay down their mortgage. Now they have 10% equity in a market that will start rising in the next 12 months. And they get the tax and insurance benefits of home ownership. Back to 78703: it's affluent and, as such, one of the few areas in Austin prone to price fluctuations. For the first 3 months of 2005 homes in that area sold for $231 sq ft: in 2008 it was $312, a 35% gain in 3 years. In 2009 it's $285 sq ft, a 10% drop. If you bought in 2005 at $231 sq ft, you can probably sell for at least $275 sq ft today, that's a 19% gain in 4 years. When you have bubbles they will inevitably be followed by bursts. You can see how the market differs within one region. I work with many first time buyers who quote headlines about a 20% drop in US housing prices, and they expect prices in the entry level market to drop in Austin. If they have stable jobs and plan on staying in Austin for at least 4 tears, they are hurting themselves financially by staying in an apartment. As I said, I feel for anyone going through difficult times. It does no one good when anyone suffers.
but who wants to live in Austin?its in Texas for Gods sake!
"they are hurting themselves by staying in an apartment"
well that depends... for a younger person, new in a career, the flexibility to move is far more valuable than any likely home appreciation over the next few years. my first few years working in industry, I worked in Los Angeles, San Diego, Florida, Australia, Texas, New York, Arkansas, Spain, and Germany. Had I bought at my first opportunity I would likely have passed on some of the great employment opportunities that came my way.
Also, buying a home even as a four or five year investment, the home would need to appreciate about 8% minimum, to cover the transaction costs of selling it.
Clint, above you called me a pessimist, and insinuated that I have a million dollar home I can't sell. Do you always invent things and guess to insult others? are you really that pathetic?
well that depends... for a younger person, new in a career, the flexibility to move is far more valuable than any likely home appreciation over the next few years. my first few years working in industry, I worked in Los Angeles, San Diego, Florida, Australia, Texas, New York, Arkansas, Spain, and Germany. Had I bought at my first opportunity I would likely have passed on some of the great employment opportunities that came my way.
Also, buying a home even as a four or five year investment, the home would need to appreciate about 8% minimum, to cover the transaction costs of selling it.
Clint, above you called me a pessimist, and insinuated that I have a million dollar home I can't sell. Do you always invent things and guess to insult others? are you really that pathetic?
- klarek the realist
- Contributions:7044
"Depending on whom you believe, we are in the 9th or 12th month of recession. How long do you expect it to last?"
The recession began officially in Q4 2007, so we're more like 16 months into the recession. Just thought you needed some simple arithmetic assistance to prove your point. That said, this recession is likely to last at least two years. When things start turning around, you'll see interest rates rise, keeping prices suppressed for some time. I guess only pessimists consider the true underlying fundamentals of the market.
The recession began officially in Q4 2007, so we're more like 16 months into the recession. Just thought you needed some simple arithmetic assistance to prove your point. That said, this recession is likely to last at least two years. When things start turning around, you'll see interest rates rise, keeping prices suppressed for some time. I guess only pessimists consider the true underlying fundamentals of the market.
- daveyjones2007
- Contributions:469
$275/ft seems like wishful thinking to me. Just looking at MLS, there are 155 homes for sale in 78703 above $500k. I can see only one pending at the moment: a fairly new house on a large well located lot, listed for about $235/ft. No matter what you think homes there might be worth, that's the market you face if you're one of those 155 sellers.
- daveyjones2007
- Contributions:469
$275/ft seems like wishful thinking to me. Just looking at MLS, there are 155 homes for sale in 78703 above $500k. I can see only one pending at the moment, a fairly new house on a large well located lot, listed for about $235/ft.
- C West, "Cwest2"
- Contributions:63
What I quoted were numbers for ALL single family residential sales in 78703, not just those above $500k. Homes below $500k in general are smaller and sell for more per square foot than larger ones. Currently 78703 has 192 total listings with an avergae price of $335 sq ft. I could go back and remove homes below $500k from the 2005 and 2008 stats, and those prices per square foot will also be lower. But the percent appreciation / depreciation rates would stay about the same.
- C West, "Cwest2"
- Contributions:63
Roberto I'm talking about people who know they are going to stay in Austin for a long time and have stable jobs. In certain professions, mobility is a pre-requisite for advancement so leasing makes perfect sense. I don't recommend that college students or their parents buy, since the odds are high they may relocate after graduation.
About 80% of a mortgage payment during the first 5 years consists of property taxes and interest which are both deductable on federal income taxes. Rent is not. 3% is the average (some areas are higher) appreciation rate: over 4 years that amounts to 12%. As you stated, seller closing costs are around 8%. And with interest rates around 5%, in some areas (ie Hutto, Round Rock, Leander, and Kyle), mortgage payments are currently lower than renting a similar size home.
"I own, and can buy 10 homes.." implies that you have a significant amount of cash on hand since lenders are limiting investor financing to 4 properties. I understood the intended sarcasm of " Austin will be completely immune forever..." which sounds as though you are disappointed that median housing prices have not fallen and expect them to do so soon.
It makes perfect sence for an investor with a signifcant amount of cash to want housing prices to drop. But for someone who already owns, such an attitude indicates either ownership in a price range already being impacted (+$1,000,000,000) or pessimism.
Roberto, everyone's situation is different. Can you not see that for thousands of entry level buyers who plan on making Austin their permanent home, even in this economy, buying is a better option than renting? Are you really that self centered?
- C West, "Cwest2"
- Contributions:63
Klarek Apparently you have a keen vision of the future "this recession is likely to last at least two years." and know of how to interpret data "keeping prices suppressed for some time." Please explain what the addition of 42,000 people per year in Austin does to the housing market. Recent history shows that such an increase generates demand for 11,000 additional single family housing units, while contractors can only get financing to build 2000? You are a finance person. So what will a deficit of 9,000 homes per year due to prices?
- klarek the realist
- Contributions:7044
I'm not a finance person, nor did I claim to be. But I do know that global recessions run at least 1.5 years. This is the most severe recession we've had in generations (hence the d-word floating around all the time), so even if it hadn't been suggested by every economist already, this recession will likely live on for more than two years since it started.
But you're the genius that stated we're only in the 9th or 12th month of the recession, so what do I know? I mean, jesus, do SOME fact-checking before opening your lying trap.
But you're the genius that stated we're only in the 9th or 12th month of the recession, so what do I know? I mean, jesus, do SOME fact-checking before opening your lying trap.
- sarcASStic
- Contributions:35
Here's the backup:
http://wwwdev.nber.org/cycles/cyclesmain.html
Given that we're already over 16 months in this recession with no immediate turnaround in sight, it's safe to say we're in the longest recession since the 43 month great depression.
http://wwwdev.nber.org/cycles/cyclesmain.html
Given that we're already over 16 months in this recession with no immediate turnaround in sight, it's safe to say we're in the longest recession since the 43 month great depression.
- DYeh
- Contributions:218
Mr. Clint West is just another typical Real Estate Agent wanting his big commissions from the higher housing price transactions, and cheering for fake hot real estate opportunities, so they can get more activities going in the market. The truth is that Austin RE Market is about 2 year lag behind California. The Austin RE peak/bubbled in 2007~2008. The California RE slide just started to be seen in Austin RE. People interested in Austin Market should be aware of the 2 yrs lag. All Austin Agents love out of town buyers, because the out of town buyers know so little about Austin Market. Anyone interested in Austin market... just check out the TCAD (Travis County Appraisal District) for trend/ups&downs (crazy ups in 2007 and 2008).
- klarek the realist
- Contributions:7044
Hard to trust Clint's demographic and population figures when he can't even get right the most obvious and fundamental indicator of our economy right now.
Is now a good time to buy in Austin?
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- 0.0/5.0
- (no reviews)
Contributions:63Banks are making it difficult for first time buyers to qualify for a mortgage. Landlords are aware of this and have raised their rent a couple of hundred dollars per month over the last 2 years. When you consider the tax deductions, it many areas, mortgages are cheaper than rent.
Additionally, homeowners receive huge discounts on car insurance by bundling their home and auto policies. Interest rates are at historic lows but are expected to rise once banks ease up on qualification criteria.
Over the last 30 years Austin homes have appreciated at a 3 to 5% rate. Central Texas is now seeing its 16th month of stable housing prices (some neighborhoods have even dropped a few points). Later this year when lenders begin to ease up on mortgages, demand along with housing prices will catch up with historic trends.
In the Austin area, for those who qualify, now is a very good time to buy a home.
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