The first two months of the year tend to be the slowest in the real estate market. And, in Austin, that was certainly the case as the pace of sales slowed a little for the first time in months.
But, looking at the nation as a whole, the start of the year marked one of the strongest increases since mid-summer. That’s part of a consistent upward trend nationally, as the market continues to recover from a low point in 2008.
In many markets, particularly in downtown areas of major cities, prices have risen quickly enough to cause many people to seek housing in neighboring areas where homes are more affordable. Jersey City, for example, is feeling the powerful market demand from people who opt to live there where homes are more affordable than in Manhattan and Brooklyn.
February saw several important real estate developments. Let’s dig in and explore the most interesting real estate news of the month.
Affordable Housing Debate Intensifies
Local real estate professionals and civic leaders started tightening their focus on the climbing cost for homes in Austin and pushing for long-term solutions. After a record-setting 2015 that saw average home prices climb by 10 percent, affordability has been the hottest topic citywide. And, in January, the metro area market saw its first decrease in the number of homes sold in months. That slowdown appears to be the result of climbing prices and a relatively low number of homes, particularly the most affordable ones, available.
Austin Mayor Steve Adler made adding more affordable housing to the city one of his top priorities, and he found enough city council support to back a plans to support several developments that include thousands of lower-cost housing options. The city decided to use tax credits and waive many of the development fees associated with the project as part of a plan to encourage developers to build affordable units. Read more about Adler’s State of the City speech here.
Short-Term Rental Homes Face New Scrutiny in Austin
Prompted by several complaints of loud partying and illegal parking, the Austin City Council voted 9-2 to phase out a form of short-term rental properties over the course of six years. The ban primarily impacts people who rent their homes out for less than 30 days but don’t live at the property. It will primarily impact homeowners who rent their property out through HomeAway and similar services that provide short-term rentals and can rent the entire house without the owner being there.
The Austin American-Statesman reported that there are 434 units licensed for those types of rentals. Only those that are in commercially-zoned areas could continue to be rented out as short term rentals. HomeAway, which recently launched a stricter policy for renters and owners, lobbied against the rules and said the approach was too heavy-handed considering most complaints centered on four problem properties out of thousands that operate regularly and provide supplemental income to homeowners.
Jersey City Booms as Some are Priced-Out of New York City
When prices climb fast in one hot area, the places nearby tend to warm up. That seems to be the case in Jersey City where the population is growing at a faster pace than anywhere else in New Jersey. The New York Times reported that the inventory of homes in Jersey City hit a three-year low and prices are climbing as a result. The newspaper reported that 7,000 units of housing are under construction with 19,000 more in the pipeline.
Home Sales Climb Nationwide
The pace of sales for previously-owned homes increased 11 percent year-over-year in January, marking the best increase since July, according to the National Association of Realtors. Only the western part of the country saw a decline in sales. The median price for all home types was up 8 percent in January, reaching $213,800. It marked the 47th month on consecutive increases, as the U.S. housing market continues its slow climb back from the crisis of 2008.
A Chart-Topper for Real Estate Agents
No wonder your agent seemed so happy. Hot sales, fair wages and a booming market make Austin the fourth best city in the nation for real estate agents. The city trailed only Denver, Irvine and Seattle in a new study by the personal finance website Wallethub. Perhaps not surprisingly, Detroit was at the bottom of the rankings. The lineup was based on 13 metrics, including sales per agent and housing market conditions.