Booming Austin real estate market is adding new homes at crazy rate
There's one way to meet the crazy demand in Austin's booming real estate market: more houses. And Austin is poised for a banner year, with annual home starts at their highest rate since 2006.
A new survey from Metrostudy shows that Austin's new home starts shifted into "high gear" this summer, reaching 4,067 — the highest quarterly figure in six years. Even more impressive? The annual start pace is 13,402, the highest in almost nine.
The bulk of these new homes are located in the northern portion of the area; the second highest volume is in the northwest. "Home shoppers who want to be in emerging markets like Leander and Liberty Hill now have a plethora of new home choices," notes the report. While the south submarket is much smaller, the annual starts pace there has increased 27 percent year over year.
"Demand shows no signs of easing, and supply is catching up. The challenge, if there is one, is in the product mix," says Vaike O'Grady, regional director of Metrostudy's Austin market, who says that the majority of the activity in Austin is below $300,000, which used to be single-family homes on traditional lots, but that's changing.
"The big winners so far in 2016 are the builders offering smaller product that meets the budget and lifestyles of emerging family types," O'Grady explains. "Those experiencing significant sales gains are the builders who have figured out how to accurately target key demographics and psychographics within their submarkets."
Some builders are "de-featuring" current home plans to cut prices, while others are building duplexes, townhomes, and condominiums.
As 2016 comes to a close, expect suburban home sales to remain strong. "Large communities are coming online in San Marcos, Dripping Springs, Manor, and Del Valle. Communities like Georgetown, Pflugerville, and Leander are maturing, adding amenities and services to entice future homebuyers," notes the report.
"With no significant headwinds, and with growing offerings below $300,000, Austin is poised for a banner year."