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from: Michelle Pitcher, Austin Business Journal, Billy Gates, Tahera Rahman
Posted: 08/13/2021 / 9:43 AM CDT
Updated: August 14, 2021 / 11:44 am CDT
AUSTIN (KXAN / Austin Business Journal) – Experts believe Austin could soon be the least affordable place to own a home outside of California.
An outlook from online real estate company Zillow suggests that Austin homeowners will be spending just over 30% of their household’s monthly income on a mortgage by the end of the year if the current trend continues. Anything over 30% is considered “home-heavy” and the outlook assumes that mortgage rates will remain stable. Some experts believe that mortgage rates will rise with inflation in the next few months.
While Austin is currently cheaper than the Miami, Seattle, and New York City markets, Zillow expects all three typically expensive markets to be below the 30% mark by the end of the year.
“We have seen average home prices increase in the range of 30 to 40% year over year in our region,” said Jeni Williams, assistant director of government for the Austin Board of Realtors.
She said Zillow’s projects reflect what she’s seen over the past few months.
“We have also observed that inventory levels are becoming increasingly scarce due to the surge in demand,” said Williams. “And the listings have also increased, but unfortunately cannot keep up with this demand.”
“It’s definitely more limited than it used to be,” says Clair Daly, who has been looking for a home in the north of Austin / Pflugerville since January.
She thinks she is happy; she lives in her family’s AirBnb while looking for a home amid short supply and rising costs.
“I want to buy a house now, but now it is the most expensive ever, but in another year it will be the most expensive ever. So now is really the right time to get in, ”said Daly.
She said she saw some entries in her budget but they were leaving fast.
“It’s just about being quick and having someone who gives you the advance notice that something like this is coming,” said Daly.
She works at Twelve Rivers Realty and said a good realtor was key to getting a bid on two homes.
Affordable housing
This week city councils allocated around $ 79 million for affordable housing.
A city spokesman said funding will flow into four housing and planning department programs for both tenants and buyers: rental subsidies, property subsidies, charitable contracts and land purchase.
Austin City Council approves $ 4.5 billion budget, record police funding
“There is no silver bullet to address our general housing situation here in Austin,” said Williams.
Williams said the funding is primarily aimed at low- to middle-income families, rather than addressing affordability or availability for all, like middle-income households.
“We encourage city guides to take an ‘all of the above’ approach to focus on making the development review process leaner, more effective and more efficient,” she said.
While policy changes and funding won’t change the trend of the Austin subway until the end of the year, she said it will be a long way off.
To learn more on the subject, visit the Austin Business Journal website.
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