Real Estate Information Archive

We all hear a lot of how great Austin is and Austin consistently ranks high in nationwide surveys of "Best Cities".  These rankings are usually for a month or maybe a year, but how does Austin (and Texas ) hold up over the long term? And what do the experts project for the next Decade?  

Here’s a list of articles from this year discussing the long term demographics and economic strengths of both Austin and Texas:   

• Austin is Kiplinger's number-one Best City for the Next Decade – “Austin is arguably the country’s best crucible for small business.” … It has “a huge angel-financing network, billionaires who will freely offer you advice,” plus a culture that “attracts the best and brightest.”
• Texas is the big winner in population growth for the decade– Brookings Institute study: Big Texas metros have done well because they avoided a lot of the pitfalls of the housing boom and bust. Six Texas counties are among the 25 fastest-growing from 2000 to 2009: Rockwall, Williamson, Collin, Hays, Fort Bend and Montgomery. The Houston metropolitan area, which has a population of 5.9 million, is the USA's sixth-largest, up two notches since 2000. Austin, the 35th-largest metro at 1.7 million, moved up five spots and San Antonio ranks 28th, up one rung, at 2.1 million.
• Texas job growth tops nation for the decade - Texas continued to make strides in private sector job growth during the past 10 years. Texas led the nation with 724,300 more net private sector jobs in December 2009 compared with one decade ago.  Over the last 10 years only two of the 10 largest states, Texas and Florida, had positive job growth.  “Texas’ business, tax, and economic policies created an environment where businesses can succeed and create jobs.” (Source: Austin Business Journal, U.S. Department of Labor Bureau of Labor Statistics and Texas Workforce Commission)
• Ten boom towns with resilient economies, growing industries, and lots of job potential. Knowledge workers, take note. – BNET ranks Austin number one for job growth over the next decade. “Over the next decade, the best jobs are going to go to the cities with the industries and the entrepreneurial incentives in place to support a highly educated, tech-savvy workforce.”
• Best Cities for Jobs – Moster.com ranks Austin number one for jobs in 2010 and lists the criteria needed for creating jobs in the future that are a great match for Austin: 1) Tech companies are moving there, 2) Universities and research parks collaborate with the local business community. 3) The political climate is business-friendly. 4) There’s a high concentration of entrepreneurs. 5) A large proportion of the residents have a bachelor’s degrees or higher.
• Texas gains the most Jobs over the Decade– Another Brookings report showed that Texas gained the most jobs with more than 40 percent more jobs at the end of 2009 than at the end of 1999.

Source: Gracy Title - Austin

In the late 80’s and early 90’s in Austin, job growth stopped, real estate values dropped and people left town. Probably because of the severity of that recession, Austin has faired much better this time. Home prices did not increase more than could be supported by median family incomes. Thanks to Texas’s home equity laws, consumers could not borrow against their home appreciation nearly as easily as homeowners in other states – which helped keep home prices stable and consumer debt manageable. If you don’t have a bubble then you don’t have a bust. While most other major real estate markets have seen home prices drop by as much as 50% and experienced high unemployment, Austin’s median home price has been stable or seen only a small drop. Job losses have been slight. 

Now, Forbes and Moody’s Economy.com projects Austin's economy will grow by 32% over the five year period from 2007 to 2012. Not only is Austin’s economy growing, but it's growth rate is nearly 50% higher than #2 ranked Fort Myers, Florida. Equally important to Austin’s economic growth is Austin's population growth which is expected to grow by an amazing 15%.

 “To compile our list, we looked at all of the country's 363 metropolitan areas, defined by the U.S. Census Bureau as a geographic region with a "core urban area" of at least 50,000 people. Because many small metro areas are high growth--and because we wanted to show growth in large cities as well--we split the group into two classes: the largest 100 metro areas (with at least 528,000 people) and everyone else. We use projections run for us by Moody's Economy.com to show growth in GMP between 2007-2012.

Of course, if one looks at economic growth in the country's largest 100 metros, the usual suspects jump to the top of the list. With an estimated 32% GMP growth from 2007-2012, Austin, Texas, is the winner for big metros. Atlanta, Seattle, Orlando, Houston and San Jose, Calif., also appear high on the list. What do they all have in common? They're tech hubs with proximity to universities and a healthy increase in population. Austin's population, for example, is expected to increase by nearly 15% by 2012, according to Moody's Economy.com forecasts.”

Go Austin. Go.

Full Article: http://www.forbes.com/2008/01/30/economy-cities-alabama-biz-cx_bw_0130econcities.html