Mark Sprague, Economic Update, Austin, Texas
Courtesy of Larry Locke, with McAllister & Associates, Austin, TX, the following is a brief summary of an economic update recently provided by Mark Sprague, State Director of Information Capital at Independence Title Company
- Austin is not believed to be in a development bubble – 60,000 new residents move into Austin each year.
- Job creation is very positive with expectations of 22,000 new jobs within the next few years.
- There is definitely a lack of new homes coming on market – currently only 3.3 months of inventory remain.
- It is expected that every existing SF lot will be sold by year’s end.
- $45,000 builder lots may be difficult to find due to the cost of land in the market today.
- Smaller homes (2/1) are having a resurgence to accommodate smaller builder lots.
- The average residential home should exceed $200,000 in next couple of years.
- Publicly traded home building companies will begin to develop their own lots.
- Consumer financing will continue to be a problem during the economic recovery.
- It is expected that mortgage rates will increase, but when is not known.
- Inflation should be a real factor in the near future.
- Of course, utilities will remain a problem throughout Austin area.
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