Austin’s housing market may be reaching a turning point in which lack of affordability starts to drive residents out of the city, according to panelists at a session titled “Cracking the Housing Affordability Code” at Austin’s South by Southwest festival.
The rapidly growing city doesn’t have enough housing supply to meet the demand for all those who want to move there, according to the Austin American-Statesman.
From 1999 to 2019, the median home price rose by nearly 30 percent nationwide while the median household income grew by 11 percent. With housing and rental prices skyrocketing across the country, many have flocked to the Texas capital seeking affordability. In 2012, most residents in 34 states could afford to live in Texas. By 2019, that was true in only 20 states.
Austin’s housing conditions are “as stressed as almost anywhere in America” and more and more people will be priced out unless real progress can be made, said the leader of the panel, Henry Cisneros, a former San Antonio mayor who later served as HUD secretary under President Bill Clinton.
“In short order, like Silicon Valley, it could result in people having to make career decisions and say I can’t live there, I can’t afford it. I want to be there, I want to work there. I can’t afford it,” he said.
Within Austin’s city limits, the median home sale price was $550,000 in January, according to the Austin Board of Realtors, an increase of 20 percent from last year. The average rent for a one-bedroom apartment in Austin has gone up by 32 percent to $1,575 compared to this time a year ago, according to Zumper.
The city’s severe housing shortage is largely to blame. Housing experts say a stable housing market is when neither the buyer or the seller have the upper hand in negotiations. That’s typically defined as six to six-and-a-half months of inventory, meaning it would take that long before all available homes were sold if no others became available in that time.
In Austin’s market, there’s enough inventory to last 10 days.
The city council is weighing temporary measures to combat the issue such as allowing residential use in commercial buildings and making it easier for homeowners to build accessory units on their properties.
[Austin American-Statesman] – Maddy Sperling