Are you looking for a vibrant city to invest in? Have you thought about what city prospects are looking healthy for real estate investing today? The Austin real estate market is indeed looking healthy and prospering. Whether you are looking for appreciation or cash flow, Austin real estate is looking attractive this year. In fact, Austin has been ranked the hottest real estate market to invest in 2017, according to PwC. This is mainly due to the job growth that is leading the local economy and positively influencing various sectors, real estate in particular. Other reasons include the attractions that the city offers across a wide range of aspects.
Today we delve into Austin real estate to provide you with insights about the local housing market. We recommend that you read below the points that we have formulated to be able to come sound investment decisions. As we go further exploring the local housing market and the drivers of Austin real estate, we go on to provide to you with a list of top neighborhoods to invest in today. Make sure that you assess each and every one carefully before you proceed with your real estate investment. Remember good planning and budgeting is key.
Strong Population Indicators and High Moving in Rates
Austin has been witnessing an increase in its population for years now. The US Census Bureau shows that Austin ranked 9th in 2016 among all US metro areas for population growth. From 2015 to 2016, Austin population grew by 2.9%. This fast growing population is translated into more job growth. Sectors such as healthcare, computer technologies, and energy have been particularly booming.
Employees continue to choose Austin given the abundance of jobs to fit every career path. This has caused more demand for housing, therefore raising property prices. Austin property prices went up by 8% over the past year. Nowadays the median home value in Austin real estate hovers around $350,000. Meanwhile, the median rent price is set high at $1,650, $50 higher than the Austin metro median rent. Although property prices are considered high in Austin, real estate experts expect them to increase even further by another 3% over the next year. We recommend that you invest in Austin real estate now, before property prices go too high.
Job Market Booming
As we mentioned, the job growth in Austin is prospering today. The city is witnessing growth across many sectors and will continue to do so for the upcoming years. Jobs in healthcare, computer technologies, and the energy industry continue to contribute to the job growth, with two thirds of new jobs in the past year in these sectors. Sectors such as energy and computer industry, in particular, provide higher-paying jobs, thus raising the quality of life, which further pushes rent and property prices up.
It is important to note that the job growth is caused by the fast growing population. The sharp increase in population is commensurate with home building. More people are demanding residential real estate properties, therefore causing demand to outstrip the pace of home building. This could potentially harm home buyers and real estate investors alike.
Tight Property Inventory and Fast Selling Homes
The fast growing population and job market have been translated into more demand for housing. In fact, the Austin real estate market has been selling more homes than ever. In fact, Austin property supply continues to decrease despite builders’ effort to keep up. This low inventory of properties has eventually led to an increase in property values. One example can be seen through the starter home market.
Austin real estate has been seeing an enormous drop in the availability of starter home inventory. Data shows that the average median price of a starter home in Austin hovers around $180,000. This is about $20,000 more than the national median price for a starter home. Although prices are higher than the national average, the increase the Austin real estate market has been witnessing has been steady and only requiring 4% increase in income to afford a starter home, as compared to 2012.
Austin’s Top Attractive Neighborhoods
Although the median home price has increased by 20% from that of last year, hovering at around $800,000, the attractions and historical sites continue to create demand for Austin real estate in Windsor Road. About 53% of Windsor Road real estate investors are home owners as opposed to rental investors. The high median rent that is about $1,600/month provides a good explanation of the high percentage of home owners. Overall, the neighborhood’s excellent educational system and enabling environment have attracted more families to move into it.
Allandale is a more affordable option with median home value ranging about $350,000. The neighborhood has a higher percentage of home owners (64%) versus renters. Many families continue to invest in Allandale given how quiet and affordable the neighborhood is, not to neglect the advantage of being in close proximity to busier neighborhoods like Hyde Park. The neighborhood is ranked the 3rd best neighborhood to raise a family in, according to Niche, this year. If you are looking for a quiet neighborhood to start a family, then begin here.
Close in proximity to Downtown, Highland Hills enjoys unique conventional and unassuming home designs and architecture. This has made the neighborhood more beautiful and appealing to real estate investors. Consequently, Highland Hills has higher median home price than other locations around, with median home price reaching $700,000. Although expensive, Highland Hills continues to attract many families for its restful atmosphere, meandering creeks, and wildlife.
The fast growing population has aided in the growth of the job market in Austin. This, in turn, translated into more demand for housing, which caused home prices to increase. People, however, continue to flow into the city for the prolific opportunities it offers. We recommend that you make a move today may you want to pursue Austin real estate investments. Hurry before property prices are too high!
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