Earlier this week I wrote about the foreclosure situation in Sacramento, the California state capital, pulling from interviews I did for an article in the May issue of the Foreclosure News Report, published by RealtyTrac.
Now we’ll shift halfway across the country — and a world away in many ways —to another major state capital: Austin, Texas.
While foreclosures continue to drag down the Sacramento market, Austin foreclosures are quickly disappearing in the rear view mirror as the city’s real estate market accelerates — powered by a strong job market and reasonable home prices.
Jobs Driving Recovery
Lower unemployment and job creation are stemming the tide of Austin foreclosures, and also helping to increase demand from move-up buyers, according to Harold McGee, a real estate agent for Nextage Captex Realty in Austin.
“Now that the job situation is getting a lot better, people are looking at moving from the entry-level home,” said McGee, who co-hosts a local radio show on Austin radio station KLBJ 590 called The Savvy Real Estate Show. “I think it’s only getting better from here, and not just this year. Now we’re going back into our bull cycle. Most of the foreclosures are getting scooped up.”
The percentage of foreclosure sales is much higher in some outlying Austin metro cities such as Round Rock and Hutto to the northeast and Buda and Kyle to the southwest, according to local experts.
“Dig a little deeper into these neighborhoods and you find that foreclosures and short sales can account for more than 60 percent of the total transactions,” said Monte Davis, principal at Davis Company Real Estate in Austin. Despite the pockets of higher distress in the greater Austin metro area, Davis and other local real estate agents remain bullish on the region’s overall housing outlook.
“Austin has experienced year-over-year increases in sales volume for 10 months in a row,” said Davis, who specializes in working with real estate investors and is an active real estate investor himself. “In addition, another healthy increase in the median price indicates competition is increasing among buyers as the inventory of homes continues to shrink.”
Davis wrote me a follow-up email just this week, providing more evidence of a strong housing market in Austin.
“It’s been wonderfully busy out here; investors are moving up (selling and trading up) and moving into our market to capture additional properties,” he wrote. “I am meeting investors who are coming from the Phoenix and Las Vegas market because of the buying frenzy is pushing prices beyond reality.”
Sign for a free trial issue of the award-winning Foreclosure News Report to read the full article, titled “A Tale of Two State Capitals”, along with many other articles covering the foreclosure market.