Austin is known for being a unique city. Home to a huge colony of bats, the most live music venues per capita and just about every kind of festival throughout the year, Austin allows residents and newcomers alike a variety of experiences. Austin neighborhoods are representative of just how unique the city is. Now, Austin neighborhoods have helped the Texas capitol top the list of real estate markets in 2017.
The Urban Land Institute and PwC have worked together for 38 years to survey and analyze data that allows them to rank major real estate metros throughout the U.S. and Canada. To develop the list, analysts collect interviews and survey responses from over 1,800 leading real estate experts, including investors, fund managers, developers, property companies, lenders, brokers, advisers and consultants. This year, niche neighborhoods and economic diversity appear to be the strengths of this year’s top ten U.S. cities, according to Emerging Trends in Real Estate® 2017.
Key Benefits of Austin Real Estate
Austin’s rise to “Top City” this year is largely attributed to niche neighborhoods and the depth of economic diversity. Industries from manufacturing to education, health care and technology are well represented in Austin. Austin has also established itself as a tech hub, which is an industry that boosts economic resilience real estate strength in cities where it’s thriving.
“Viewed as a fluke when it hit the study’s top ten list 5 years ago, Austin’s rise to the top of the list signals the durability of the city’s long-term appeal to investors,” says Mitch Roschelle, PwC Partner and Real Estate Research Leader. “Austin, along with many of this year’s top 10 cities, boasts attractive, niche neighborhoods and a vibrant, diverse economy.” Another benefit to Austin’s real estate market is the continued strong demand for real estate. Atlanta, GA and Denver, CO – two real estate darlings of previous years – have dropped off the top 10 list due to concerns that demand isn’t keeping up with supply.
Key Real Estate Trends for 2017
Overall, construction labor shortages and the rapid spread of digitization throughout the industry are also playing key roles in fueling 2017 real estate trends. Referred to as “Optionality,” the multi-purposing of in-demand spaces also appears to be a new key feature of strong real estate investments. According to the authors of the report, real estate appears to be undergoing an “auto-correct” cycle. Digitization in real estate is improving accuracy, transaction speed and transparency. Additionally, real estate seems to be under a natural market balance as rising property prices slow transaction volumes and the length of time it takes to make new housing supply available maintains a steady demand.
“This year’s report shows that there are opportunities stemming from a shift in how, where, and when people work,” says ULI Global Chief Executive Officer Patrick L. Phillips. “One of the trends leading to new opportunities is multi-purposing of commercial space. We’re seeing different types of tenants using the same space for different uses at different times of the day, particularly in tight markets. Buildings with open, flexible space have a competitive advantage.”
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