It’s very likely that Austin real estate is going to have another banner year in 2019, according to the most recent real estate statistics from the Austin Board of REALTORS® (ABoR). It’s another year in a continuing trend of local real estate growth that can’t last forever. While the past year’s real estate statistics confirm that this is yet another year of stable housing growth, what will the next year in Austin area real estate bring for homeowners and house hunters alike? To get an idea of what we can expect in the coming year, we took a look at the biggest stories in real estate to find some clues.
A collection of Austin real estate news from the Austin Business Journal (ABJ) points out some strong evidence of another year of stable growth for the local jobs market. Experts agree that when there’s job growth, there’s also real estate growth. It is true that the Austin real estate market can’t expand forever, but the likelihood of a full-out downturn is very small. That’s great news for homeowners in the area who are building wealth through rising home equity. Check out this collection of 2019’s top real estate stories for insight into what could happen in Austin area real estate in 2020.
ABJ’s Biggest Real Estate Stories of 2019
- Tech companies continue to move or expand in the area. In 2019, hundreds of thousands of square feet of office space were leased out to some of the world’s biggest names in tech. Downtown, East Austin and North Austin all saw an increase of signed leases on office spaces for tech giants. Google Inc. leased 873,000 square feet, one in downtown and one on the east side. Google’s leases takes up two entire buildings under construction in the area. According to the ABJ, that’s enough room for about 5,700 more workers. Amazon.com Inc. leased about 245,000 square feet of office space at Domain 10. ABJ confirmed with Amazon that 1,400 employees will be employed there. Other major companies like Visa Inc., Allergan PLC and Indeed Inc. each leased more than 100,000 square feet, as did the Teacher Retirement System of Texas.
- Builders are putting more developments in the pipeline. This year saw a new record for office space breaking ground in the Austin area. In fact, the ABJ reports that there’s an impressive 9 million square feet of office space under construction in the Austin metro. The biggest of the projects is 6 X Guadalupe, which will be Austin’s tallest tower at 66 stories. It’s expected to be completed in January 2023. According to the ABJ, “Construction isn’t expected to slow down any time soon in the capital city, which was again named the No. 1 city to watch for real estate investment in 2020 in a closely watched report from PricewaterhouseCoopers and Urban Land Institute.”
- Home values continue to strengthen. Yet another record was set for Austin area home sales prices as the median sales price for a single-family home in the City of Austin increased 9% year-over-year to reach $405,000 in October. The October sales price is the highest median price for any October on record, according to ABoR. Housing inventory for single-family homes in Austin reached an all-time low for October, only 1.5 months. Though the Austin real estate market is expected to continue to strengthen, it’s expected that sales price growth will happen at a more constrained rate moving into the new year.
- Downtown isn’t the only place worth working. As far as real estate goes, East Austin truly came into its own this year. The East Side is said to be on almost equal footing with highly sought-after Downtown commercial real estate. “Because of rising prices in downtown and the coolness factor of the east side more companies, such as law firm Pirkey Barber, are giving up their Congress Avenue address and moving east. New and renovated buildings are selling at a rapid rate and at similar prices to downtown-based on price per square foot.” Additionally, major developers such as Lincoln Property Co. and Kor Group are planning their first project in East Austin. The ABJ also noted that developer Riverside Resources is doubling down with a large mixed-use project proposed for East Sixth Street.
What the Experts Say
This year showed us that we can’t really predict what will happen in real estate. In fact, one local real estate expert publicly ate crow about the real estate forecast for 2019.
“This time last year, we expected the housing market would slow, but that’s not been the case. We’re seeing very strong numbers for new homes across the board,” said Vaike O’Grady, Austin regional director for Metrostudy. “Because Austin is severely constrained, home builders are moving outward in search of lower land costs and development opportunity. The surrounding counties are going to continue to emerge with the current demand.”
Although the signs are strong that the real estate market will experience yet another year of growth in 2020, home buyers and homeowners both are strongly advised to enlist the services of a trusted and experienced Austin real estate agent. Only an experienced agent can help you make the best real estate decisions for your individual situation. Through consultation and market education, a trusted real estate advisor will help you make the best of your real estate investment now and into the future.
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