Supply and Demand

Austin surprisingly bucks this nationwide real estate trend

Austin has seen a bigger uptick in home inventory than anywhere else in the country.

Photo courtesy of Kuper Sotheby's International Realty

All across the U.S., there are typically fewer homes for sale right now than there were this time last year — except in Texas. Austin, Dallas-Fort Worth, Houston, and San Antonio are all seeing an increase in inventory, which contradicts the main findings in Zillow's February Real Estate Market Report.

The real estate and rental marketplace found that, nationally, inventory is down (nearly 3 percent) and home values are up (6.9 percent, their highest since June 2007). This combo signals another competitive home shopping season.

In Texas markets, our home values are certainly rising, but so is the number of homes for sale.

Austin, in fact, has the highest inventory increase in the report: up a whopping 24 percent over last year. Home values are right in line with the nation at 7 percent higher ($264,800), which is also similar to San Antonio's 6 percent. The availability of homes in the Alamo City is up 16.4 percent.

Dallas-Fort Worth has 4.1 percent more homes on the market, and they're valued at 11.1 percent more than they were this time last year. That's among the top three increases in the country, second only to Seattle and Tampa.

With its 3.1 percent increase in available homes, Houston is well ahead of most of the cities in the study, even if its 4.5 percent home value increase is below that of the national average.

Homes are actually scarcest in Minneapolis-St. Paul, while Las Vegas is right behind No. 1 Austin for its abundance of homes.

zillow reports

Eviction Notice

Major landlords with Austin ties being investigated for illegal rent hikes

Photo courtesy of KVUE

Some of Austin's rent woes could be a result of this alleged scheme.

The Justice Department (DOJ) is suing six of the country's largest landlords, along with RealPage, alleging they took part in a pricing scheme that harmed renters.

We already know the increase in population and businesses moving to Austin raised rental prices. But lawyer and owner of Texas Tenant Law Jennifer MacGeorge said the new DOJ lawsuit could prove illegal rent hikes made it even worse.

"It's about collusion versus competition," MacGeorge said. "It's just about trying to gouge the market and get as much as they can."

The antitrust lawsuit claims six property management companies — Cushman & Wakefield, LivCor, Cortland, Greystar, Dallas-based Willow Bridge, and Houston-based Camden, which have numerous locations in the Austin area — are using software like RealPage. Together, the landlords control 1.3 million apartment units.

According to the lawsuit, the software uses an algorithm to help set rents and privately share sensitive, non-public information with competitors, allowing landlords to align their prices and avoid competition.

MacGeorge said the result is higher rents, for not only residential but commercial properties. She said this type of behavior exacerbates affordability issues and displaces residents and small businesses.

"We're getting rid of people that help the economy sustain itself and be stable, which is what everybody's looking for in this environment where you can't even afford your groceries, and now you're worried about your rent. It's absolutely unacceptable," MacGeorge said.

The lawsuit names the Austin-Round Rock metro area multiple times, saying 30 percent or more of the residential properties in the area are using this type of software.

While MacGeorge mainly represents tenants, she found out some of her landlord clients are using similar pricing strategies to artificially raise prices.

"They are engaging in other practices that are artificially raising prices, such as putting in a rental rate at a renewal that's maybe 20 percent above what the tenant was paying before and leaving it that high only until the tenant moves out and then immediately dropping it," MacGeorge said.

Read the full story and watch the video at KVUE.com.

rent lawsuit housing market apartments