Southwest Austin - Community Impact Newspaper

Housing
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he said. “I would not even think of
selling a house until two years from
now, at least. “
If homeowners must sell, Angelou
advises they consider renting
their house out for the near future,
as the rental market remains stable,
and use that money to help cover
the payments on a new home.
“If you’re buying, now is the best
opportunity to buy,” he said. “I
wouldn’t wait for the market to go
down any further, necessarily, because
the minute it goes down further
and the credit market is unfrozen,
then a lot of people are going to
jump in it.”
RE/MAX real estate consultant
Shara Parker said, thanks to lower
interest rates and home prices,
selling now can be a viable option,
depending on the move a seller is
looking to make.
“It is an excellent time to sell if
you’re going to move up. If you’re
buying more equity for a higherpriced
home, then you’re cutting
your losses,” Parker said. “And if
you’re looking to buy, absolutely,
you need to go ahead and buy.”
But being a buyer’s market does
not mean property in the booming
78749 ZIP code, ranked the second
fastest selling ZIP code in the country
late last year by BusinessWeek
magazine, is going to come cheap.
“It’s a little different here,” Parker
said. “I think a lot of people get
confused with the national news. A
big challenge that we face is that the
buyers come in and think they can
buy a house in this area for pennies
on the dollar.”
The drop in home values in
some parts of town has put more
homes within the average buyer’s
price range, but Parker said at the
same time it has become harder to
get credit.
“The guidelines have tightened
so much now that even A+ credit
buyers are challenged,” she said. “I
don’t think it can get any tighter
than it already is.”
The psychology of a recession
Despite Austin’s high-tech reputation,
Angelou said it works to the
city’s advantage that not all of the
local economy is tied into the technology
industry.
“When 25 percent of your economy
is the government, another 25
percent is professional services and
another 20 percent is retail trade,
70 percent of Austin’s economy has
nothing to do with technology and
is fairly stable, with the exception of
retail,” he said.
Pointing to 2010 as a likely date
for economic recovery, Angelou
said 2009 may be a rough year, and
as more people are out of work, the
more pessimistic the national picture
will become.
“The psychology of the market is
very important. If you expect that
the economy is going to get better,
it instantly gets better. But we’re
going to see massive layoffs in Austin,
and I say ‘massive’ by Austin
standards,” he said. “The unemployment
rate will exceed historical
highs: 6.5 percent. The national
unemployment rate will go higher
than 9 or 10 percent.”
Last one in, first one out
The oft-repeated conventional
wisdom that “Texas is the last one
in a recession and the first one out”
may have been true in the past, but
Angelou said the stakes are higher
now than during previous economic
rough patches.
“There may be a difference here,
because this is no longer a real estate
and housing bubble — this is
the collapse of the U.S. economy including
technology,” he said. “When
we’re hit by both a real estate-led
recession, as well as the high-tech
recession, it may be that we may not
come out as soon as we anticipate.”
Angelou said the good news is
Austin home values have never appreciated
to the degree national
values have.
Helen Edwards, president and chief
operating officer for Coldwell Banker in
Austin, said she sees the potential for a
housing shortage, but is skeptical about
a drastic increase in price for southwest
Austin homeowners.
“I believe that there will probably be a
time when we will experience a higher
demand than supply. That’s the way it always is in real
estate,” she said. “Do I think it’s going to be an overwhelming
shortage? No, I do not.”
5,000
4,000
3,000 5,000
2,000 4,000 4,061
1,000 3,000
2,000 0
1,000
100
80
0
100 60
40 80
20 60
40 0
20
The 2008 Austin real estate market
3,636
impactnews.com February 2009 | 13
4,432
4,061 4,166 4,344
3,636
4,087 3,963
Jan Feb Mar Apr May Jun Jul Aug 3,546 Sep 3,027 Oct 3,082 Nov Dec
2,262
1,943
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
80 72
Southwest Austin: A balanced market
4,166
New properties listed
4,432
4,344
4,087
64 64 66 63
3,963
3,546
Average days on market
Edwards points to the amount of land available for subdivisions
and an ample supply of homes costing more than $500,000.
“As soon as it becomes viable to do so again, the builders will
build again,” she said.
Describing the market as balanced, Edwards said the
southwest Austin housing market has retained its strength
while other parts of town have seen decreases in value.
“This area has continued to have good, strong numbers
because the sellers have been reasonable about what their
houses are worth,” she said.
3,027
3,082
71 72 76 78
2,262
80
Jan
72
Feb Mar 64 Apr 64 66 71 72 76 78
85 87
May Jun 63 Jul Aug Sep Oct Nov Dec
Source: Austin MLS Market Data
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
$260,000
$255,000
$250,000
$245,000
$240,000
$235,000
$249,897
$251,577
$230,000
$238,161 $239,638 $241,365
$225,000
$231,582
$220,000
$215,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
$253,949
$260,000
$255,000
$250,000
$245,000
$240,000
$235,000
$249,897
$251,577
$230,000
$238,161 $239,638 $241,365
$225,000
$231,582
$220,000
$255,392
$215,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
$237,504
$239,606 $238,947
$231,053
$253,949
“[Values] are not likely to go
down as much as they have nation-
“When conditions do improve have lost their jobs in smaller mar-
nationally, Austin will be well-pokets will move to Austin and other
ally,” he said. “But we’re not imsitioned for a rebound because the areas like it.
mune from the national cycle, so overall inventory levels are low,” “In a way we’re kind of blessed
we’re seeing the impact.”
Rude said. “At this point, the most that we have a housing market
Rude said job losses, the credit significant variable impacting local that has a lot of challenges, but
crisis and uncertainty about how demand for housing is depressed nowhere near what those chal-
much the national economic consumer confidence. When conlenges might be elsewhere,” he
stimulus package will help houssumer confidence returns, possibly said. “[The housing] market will
ing markets make it difficult for in 2010, home production will gain very quickly recover.”
MetroStudy to predict when the momentum.”
$255,392
housing industry will stabilize In anticipation of the economy’s
Comment and find links to related websites
$237,504
at more.impactnews.com/3404
$239,606 $238,947
or recover.
recovery, Angelou said many who
$231,053
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