Austin ain't so sweet when it comes to affordability and job opportunity
Texas has some of the sweetest markets in the country, according to economists at Zillow. Unfortunately for Austin, the city falls out of the "Goldilocks Zone," where robust employment and wage growth coexist with relatively affordable real estate.
For its findings, Zillow examined average income growth, average annual employment growth and price-to-income ratio — a measurement of the median price of a house in an area versus the area’s median household income — for 287 metro areas across the country. As expected, in most of the cities where jobs are plentiful and well-paying, housing is expensive (ahem, California). On the flip side, where housing is attainable, jobs are scarce.
But a few places hit that "sweet spot" where opportunity meets affordability. Dallas is right in there, with a price-to-income ratio of 2.52, employment growth of 3.3 percent and income growth of 4.3 percent.
Austin fell out of the "sweet spot" because of a price-to-income ratio of 3.46 percent.
Houston also made the sweet spot, with a slightly higher ratio of 2.59 and higher employment growth of 3.6 percent. Its income growth was also 4.3 percent. However, Zillow cautioned against the growth, saying that the recent oil price dip might impact the situation going forward.
Austin had higher employment growth at 3.8 percent but fell out of the so-called "sweet spot" because of a price-to-income ratio of 3.46 percent. Zillow still lauded the city for looking "fairly sweet" despite higher home values.
In related news, another recent Zillow report shows that the U.S. rental vacancy is the lowest it’s been since 1993 — but Texas bucks these trends too. The current rental vacancy rate is 7 percent nationally, but it's higher in all three Texas cities.
Dallas sits at 8.1 percent, while Austin and Houston are 8.9 and 9 percent, respectively — so even if you don’t want to buy a place after landing that new job, you can still find a place to live.