Develop Austin Texas

Sandy Ranch

CNN Money’s article “What Housing Bust?” covers what areas of the nation have done well in the housing market, and why. According to writer Les Christie, areas with plenty of available developable land have smaller swings between home price highs and lows. This is because, when the demand for housing spikes, home builders are able to build more homes and keep the housing prices in check. Speed is also of the essence here, home builders need to be able to build quickly, thus, the need for available land.

“Elasticity of supply,” this is called, according to Mark Fleming, chief economist for First American CoreLogic. And Christie says, it is the definition of Texas real estate, and similar throughout all the metro areas.

“Texas is the poster child for these ‘steady Eddie’ states. House prices during the past three years rose in all 26 metro areas with gains ranging from 2.8% for Dallas, the second largest metro area, to 9.7% in Houston, the largest, to a whopping 32.5% in Odessa.”

This is part of what is causing the metro areas in Texas, including Austin, to grow so rapidly. Landowners in the Austin area should continue to see their investments in high demand for buyers and developers.

NuWire Investor and Housing Predictor released their Top 10 List for best housing markets to invest in for the remainder of 2009. “The top 10 US real estate markets for 2009 are not large metropolitan areas, but rather small communities with strong prospects for growth,” they report. “The following list of high potential housing markets may not appreciate in the short term, but have the highest likelihood of long term appreciation.”

Texas appears twice on the list: in the number one spot is Amarillo, Texas; and number eight is Austin, Texas. “Austin, Texas and Tucson, Arizona are the largest metro areas to be named to the list possessing the highest probability of growing through the recessionary economy over the next few years,” the article continues. “As a high-tech hub, Austin will have what it takes to not only sustain the downturn but see home values inflate.”

Seeing Texas twice-over on the list shouldn’t be a surprise; earlier in the summer NuWire Investor reported that the Southern region posted the strongest quarter-over-quarter price return in the housing market (despite the overall decline of 1.7%).

Austin, Texas clearly continues to remain a good investment with great development land deals to be made.

We’ve said it before and we are saying it again now. The Austin market has been and will remain relatively immune to the recent economic downturn. With news coming out that the national economy is starting to look up, analysts are looking for places that are going to recover the fastest and Austin tops the list according a recent Forbes article. Because of our diverse economy, continued population growth and immunity to the past housing crisis (and by past I mean in the past!), the Austin area is poised to show the strongest positive economic growth of any U.S. city by the end of this year.

I just watched the Texaplex video that has been floating around lately. It presents some great facts about our strong economy, job growth and population in the triangle formed by Houston, Dallas, Ft. Worth, Austin and San Antonio. I don’t agree with the blanket term “Texaplex” used to describe the triangle since these are all vastly different cities with their own economies and more importantly their own social and cultural identities. Watch the video and let me know your thoughts…

Last week, the administration announced they were eliminating all fees on the SBA’s most popular loan, the 7a loans, as well as CDC/504 loans. They are guaranteeing larger portions of loans (up to 90%) and offering 0% interest loans for small businesses that are falling behind on current loans. This loosening of restrictions will allow current businesses to grow and new businesses to start up.

While banks aren’t going to be handing money over to anyone who walks in off the street with a business plan, they are going to be making it easier for smaller businesses to get access to funds that will help them grow.  Business growth equals job growth.  The more jobs created the greater the demand for housing, land, etc…  It will be interesting to see whether or not existing business will take advantage of this opportunity and if it will pay off in the form of job growth in Central Texas.

The recent loosening of restrictions on SBA loans will greatly affect the land and development market here in Central Texas – both directly and indirectly. This post is going to focus on the obvious.

Last week, the administration announced they were eliminating all fees on the SBA’s most popular loan, the 7a loans, as well as CDC/504 loans. They are guaranteeing larger portions of loans (up to 90%) and offering 0% interest loans for small businesses that are falling behind on current loans. This loosening of restrictions will allow current businesses to grow and new businesses to start up.

With Austin’s relatively strong economy, we may see quite a few new businesses starting up in the near future. New businesses are going to need new space.  We are going to see new and creative uses of existing urban areas and (hopefully) smart growth around the urban core.