Austin Real Estate Blog

According to the Forbes Business Journal, Austin is tied for first place as the metropolitan area showing the most signs of economic recovery; Washington, D.C. was the other first-place contender.  This is in line with 2009 estimates by Forbes that Austin was positioned for a swift rebound; financial analysts predicted at that time that Austin’s economy would grow by $5 billion before 2011.  Austin’s speedy recovery was attributed to its strong government sector; as the capital of Texas, Austin benefits significantly from stable government employment in the area.

Aggressive moves to attract new companies by both the city of Austin and the state of Texas have also provided additional employment opportunities.  The Austin area has attracted several new employers in recent years including the Hanger Orthopedic Group; Austin is currently in negotiations with Facebook to open an office, as well.  Austin’s historically strong education, healthcare, and green technology sectors have ensured that unemployment rates in the metropolitan area remain lower than the state and national average.

Recent figures indicate that Austin’s employment picture continues to improve.  Job growth in Austin over the past two years approached one percent, the best in the nation; while this growth rate may seem small, it’s worth noting that over the same period the United States as a whole lost jobs and saw unemployment rates skyrocket.  In fact, Austin’s employment picture is expected to improve even more over the next three years, with jobs in the area increasing by approximately eight percent overall.

One major factor in the stability of the Austin economy is the housing market.  While other regions experienced serious declines in property values and increases in foreclosures and unsold homes, homes in Texas retained almost all of their initial value and demand for these homes remained high throughout most of the industry crisis.  Most analysts credit reasonable real estate pricing and lack of overbuilding for Austin’s relative stability and economic performance; because Texas real estate prices were never overinflated due to real estate speculation, the collapse of the housing bubble had little effect on the area.

These recent figures and predictions spell good news for the Austin real estate and business community.  Increased growth and employment is expected to bolster the commercial and residential real estate market and boost new construction, creating still more jobs and growth in the area.  This synergy will maintain Austin’s position as one of the best cities in the nation in which to live and work.

Recent figures from the Mortgage Bankers Association suggest that the worst of the housing industry downturn may be over.  For the first time in three years, fewer homeowners are falling behind on their mortgage payments; this spells good news for mortgage lenders as well as borrowers.  While economists hesitate to say that the worst is over, the reduction in new delinquencies is generally regarded as a positive sign by housing industry experts and real estate agents throughout the country.  Even in Austin, where housing prices remained surprisingly resilient throughout the nationwide woes, these figures offer fresh hope that an economic upturn is on the way.

Current national figures estimate that fifteen percent of all mortgages are at least thirty days delinquent; this includes homes currently in foreclosure as well as seriously delinquent loans.  The worst figures are seen in the subprime mortgage field, where twenty-five percent of loans were thirty days or more delinquent.  The state of Texas has fared somewhat better as a whole than the nation, but fifteen percent of the Texas subprime mortgage market loans are seriously delinquent by sixty or more days, and many of these are currently facing or undergoing foreclosure proceedings.  Only two percent of all mortgage loans in Texas are currently in foreclosure, which represents a markedly better performance than the national rate of approximately five percent.  Texas is one of only seven states currently showing foreclosure rates of two percent of less.

Austin foreclosure rates have remained lower than both the national and state averages, with one percent of loans in foreclosure in December 2009.  These low figures will likely shield Austin from the brunt of the foreclosure crisis expected when banks finally begin unloading already foreclosed homes on the housing market.  Certain hard-hit regions are expected to see plummeting home prices due to the depreciation caused by this expected glut of homes on the market; as many as six million foreclosed homes may be sold by banks over the next three years, according to economic analysts at Barclays Capital.

The strong housing market and stable home values in Austin make it one of the most desirable places to live in the U.S.  Austin’s vibrant computing, healthcare and green tech sectors provide outstanding employment opportunities and have cushioned the Austin metropolitan area against the worst effects of the recession.  With mortgage delinquencies on the decline and the national economy showing signs of recovery, there’s never been a better time to consider moving in or moving up in the Austin community.

OCLC (an organization with a mission similar to RPR, but for libraries) has alienated itself from it's supposed beneficiaries. Could something like this happen with RPR?

In order to understand the potential problems with providing original real estate records to a communally-owned database, as RPR is suggesting, it’s useful to look at an analogous situation that exists in a similar community: the library world.

On July 6, 1967, the Online Computer Library Center (OCLC) was founded as a cooperative effort among libraries to allow standardization and sharing of bibliographic records among libraries who signed up for this service. The records were to remain the property of the library that created them, but would be free to use for any member library, with only a small cost-recovery fee charged for various services. OCLC continued to grow, until today it serves 72,000 libraries all around the world, who participate by creating bibliographic records and sharing them. OCLC is also available for library users to search, allowing them to locate hard-to-find items through its online search options. So, libraries created bibliographic records for books and journals and CDs and DVDs, and users could find information on them through OCLC. And everything was fine, for a while.

Then, in 2008 OCLC announced its proposed “Policy for Use and Transfer of WorldCat Records,” which required that all records before and since that appear in OCLC would bear a line granting copyright (license) over the record to OCLC and prohibiting the record’s use in any other service that was similar to OCLC. Essentially, OCLC simply took over the license for those records. OCLC did not make those records, so how could they do this?

The answer lies in the way that copyright law is structured. The records stored in OCLC were comprised of facts. Facts cannot be copyrighted. I can’t copyright the fact that a house is located at a certain address or that it is on the market for a specific amount; I can’t copyright that grass is green and the sky is blue. I can, however, copyright the way that I describe the house, the look and feel of my real estate descriptions, and the formatting I use in creating a listing for the house. It’s the last issue, that of formatting and metadata, that created the situation with OCLC.

OCLC didn’t claim ownership over the information in its database; it couldn’t. Copyright doesn’t allow for ownership of facts. Instead, OCLC claimed ownership over the format and metadata (descriptions of the books) – the look and feel of the interface – as its justification for claiming the right to license the records. Because the information had to be entered in a format that OCLC set up when the initial database was first put into place, OCLC owned the format. The records in that format were thus the property of OCLC because the format was OCLC’s. Restrictions were outlined that restricted the rights of libraries to use the records, even for records they had created themselves and that logic would dictate those libraries “owned.” Despite public outcry, the provision was implemented in 2009.

But OCLC was a consortium of libraries working together, right? So how could they do something that was so clearly at odds with what the majority of the membership wanted?

The answer, sadly, is that OCLC’s leadership seems more interested in protecting its own financial interests than in being responsive to its membership. Once OCLC became the standard that most libraries used, it began to derive its own profit-driven agenda; since it essentially had a monopoly on the records that had already been created, it no longer needed to serve the libraries that had created it and built its success.

If any of this sounds familiar, it should. Similar situations are arising throughout the intellectual property world. If RPR successfully implements its proposed database, it can make a claim that the records contained belong to it, no matter who originally created the record, because RPR would own the format and metadata. This would allow for a widespread land grab that could end up costing members and others simply to get their own listings back.

Don’t think this could ever happen? It already has. Just ask a librarian.

New rules proposed by the Community Development Commission could spell big changes for builders seeking variances for new developments in Austin.  The proposal is modeled on a similar law already in effect in Massachusetts and would require that builders who receive special permission to build larger-than-allowed residential buildings must devote a portion of their development to affordable housing for low to moderate income families.  The Community Development Commission is comprised of thirteen political appointees who are tasked with the development and implementation of programs intended to serve low income families and households in the Austin area.

Recent developments have also led to the appointment of a new Downtown Density Task Force, a result of stalemate on the part of the previous task force which could not come to an agreement at a meeting last month.  Many builders have noted that a proposed “pay-to-play” system that would require payments to a community development fund may also constitute a deterrent to new construction in the area during a time of economic uncertainty; most economic experts believe such requirements are unwise given the current housing market downturn.

Some experts have noted that the proposal as it currently stands is in direct conflict with Texas state law, which prohibits requiring builders to include affordable housing in their planned developments.  Supporters of the proposal, however, note that the rules do not force builders to include such housing, but simply withhold the required legal variances from builders who do not make such accommodations a part of their development plan.

The timing of the proposal is unfortunate, given the recent prediction in the 2010 Texas Construction Outlook that Austin construction projects are expected to increase by approximately 30% in the coming year.  Federal stimulus funds and projects are credited with a portion of this growth, and new housing starts are expected to make up much of the rest of the increase.  Many builders feel that adding new layers of expense and paperwork will put a damper on these expected gains and stifle much of the economic benefit Austin could derive from this infusion of cash and projects to the local building industry.  While the public works and utilities projects are not expected to be affected by the proposed rule changes, some new housing developments may be delayed or even canceled if these rules are put into effect at this crucial time.  Given the fragile nature of the housing market recovery, most builders believe that these rules should not be implemented or should be delayed until the housing industry is more robust and the recovery is well underway.

Put this on my www.joecline.com/blog by accident. Here is the link, if you were looking for this post about the Realtors Property resource. I made this little ditty in Photoshop just for giggles. I was in a startup company a few years back and when the impending death sale of the company was in progress we had similarly themed, but much, much more professionally created posters. You know, don’t let any details slip out or you’ll sink the ship. Anyway, silence is great in war, but NOT WHEN YOU’RE TRYING TO GAIN BUY IN or when you’ve used association moneys to start your company!

Someone should let the folks at RPR know that we ARE interested, but are not going to swallow whatever they produce hook, line, and sinker.

South by Southwest tix are highly coverted from coast to coast and from Film geek to music geek to computer geek!

The 24th annual South by Southwest Conferences and Festivals at the Austin Convention Center will showcase the finest in film, music, and interactive media from March 12th through the 21st. In keeping with Austin’s tradition of originality, the conferences and festivals focus on independent artists and films and offer a valuable first venue for aspiring musical artists and young filmmakers. Sponsors for this year’s festivities include the Independent Film Channel, Monster Energy, Chevy, Pepsi/Mountain Dew, and the Austin Chronicle.

The South by Southwest Conferences offer participants an outstanding opportunity to network with those in their chosen fields and to learn valuable skills through discussion panels and celebrity interviews in a casual, relaxed atmosphere. The keynote speaker for the Music Conference will be the great Smokey Robinson, one of the most influential musicians of all time. The Interactive Conference focuses on the best in website design, video games and internet start-ups, making it a must-see for would-be Web millionaires. Ben Huh, the innovator behind sites like I Can Haz Cheezburger and LOLcats, will be on hand to discuss techniques and methods for achieving internet success as the featured speaker for the “How to Rawk SXSW” panel.

The film festival usually gets most of the attention for its diverse selection of films, ranging from headliner events like “Get Low” with Robert Duvall and Bill Murray and “Cyrus” with John C. Reilly and Marisa Tomei to documentaries like “Rejoice and Shout,” a moving exploration of gospel music. International films from Belgium, Israel, Ireland, Denmark, and many other countries will also be showcased at the South by Southwest Film Festival. One highlight is sure to be the presentation of “Hubble 3D,” a breathtaking look at the spectacular galaxies as viewed through the Hubble Telescope and narrated by Leonardo DiCaprio. “The Lost World,” a silent science-fiction film from 1925, and Tod Browning’s “The Unknown” will also be shown during the festival. Short film categories will include animated shorts, documentaries, experimental short films and high school shorts created by Texas teenagers for presentation at this elite venue. Music videos will also be presented, showcasing a full range of musical stylings and artistic visions.

Attendees will participate in a wide range of panels, discussion groups, and meet-and-greet opportunities with some of the biggest names in film, music, and interactive technologies. When the day’s work is done, guests of the conferences can drink and dance the night away at numerous parties with many of the same celebrities they worked with during the day; the South by Southwest Conferences and Festivals offer the best of Austin nightlife to guests at this exclusive event. For more information or to sign up for one or all of the conferences, visit http://sxsw.com/.

A new mixed-use project is expected to break ground in Austin in 2010. The University Park development is within walking distance of the University of Texas-Austin, and will incorporate townhomes, condominiums, and apartment residences as well as a new movie theater, medical office space, and a luxury Andaz hotel. Construction is expected to commence in the second quarter of 2010. Located on the former site of Concordia University, the development is already pre-leasing commercial space and lead developer Andy Sarwal has indicated he expects to have tenants for 90% of available space before construction is completed on this project.

University Park is centrally located within easy walking or cycling distance of many of the prime attractions of the Austin area, including the State Capitol, the downtown financial and business district, and of course the University of Texas. Onair Development has announced plans for a 120,000 square foot medical office building in University Park in close proximity to St. David’s Medical Center. The building offers significant advantages for physicians who lease office space, including an exclusive tenant equity partnership plan that provides the potential for ownership over time.

Texas Monthly has already taken up residence in University Park; an Aveda Institute salon training facility has also signed a contract and is expected to open for business sometime in mid-2010. Premiere Cinemas will offer six or seven screens in a planned 450,000 square foot mixed-use building, which will incorporate 340 apartments and additional retail outlets as well. Developer Andy Sarwal is encouraging builders in University Park to commit to green standards and LEED certification, making this development even more attractive to tenants in the Austin area.

Austin’s downtown area has fared better in the recent economic downturn than many other cities; this is due in part to the vibrant medical, solar, and green technology sectors in the Austin area. Additionally, Austin’s business-friendly policies have attracted major employers to relocate their headquarters to the area; one recent acquisition for the Austin economy is Hanger, a major manufacturer and supplier of medical prosthetics and durable medical goods.

All over Haiti, buildings and other infrastructure have been destroyed and people are struggling to survive.

The recent earthquake in Haiti has caused untold suffering and massive devastation to residents of this small island nation.  The humanitarian aid efforts are already underway, and rebuilding plans are expected to begin soon.  Many Austin residents have been moved by the plight of the people of Haiti, and contributions are pouring in from all over the world to assist those affected by this tragedy.  A number of local Austin organizations and companies are also working to help Haiti recover from this disaster and to provide clean water and food to the victims of the earthquake.

Austin-based Whole Foods Market, Inc. has announced the creation of a fund to help provide relief to disaster victims in Haiti.  Donations will be accepted at all 289 stores throughout the United States, and will be distributed to a number of direct aid organizations, including Doctors Without Borders, Action Against Hunger, AmeriCares, Food for the Poor, Partners in Health, and the American Red Cross.  Whole Food Markets is also collecting donations of food, clothing, and money to support staff members who have been affected by the disaster in Haiti, and working with national organizations to facilitate the delivery of food and water to the areas hardest hit by the earthquake.

The American Red Cross of Central Texas is also active in the Haiti relief efforts, and is currently requesting donations of bottled water, food, and other supplies.  It is also looking for temporary shelter and medical services for those injured or homeless due to the earthquake.  Additionally, the American Red Cross has joined forces with the U.S. State Department to allow individuals to donate through their cell phone bill; simply text the word “Haiti” to 90999, and a $10 donation will be automatically added to the monthly charges for the cellular phone.

Several Austin firefighters and emergency workers are headed to Haiti to take an active part in the rescue and recovery operations on the ground; they will bring needed supplies and expertise to the relief efforts in heavily populated areas of Haiti, including Port-au-Prince.  Austin companies providing matching funds for relief donations include Austin Ventures, Silicon Laboratories, and the MFI Foundation.  Austin residents can qualify for these matching funds by making their donations through http://www.givetoaustin.org/helphaiti, Austin residents can qualify for these matching funds.

Austin leads the nation in economic growth due to the diversity of local and statewide businesses, the University of Texas, and overall good business climate.

A recent Brookings Institution report shows that Austin’s economy continued to grow in 2009 while other cities experienced slumps and downturns in their economies. The report finds that Austin grew more from 2008 through 2009 than any other major metropolitan area in the United States. While that growth was a mere two percent increase, it far outstripped the country’s overall metropolitan performance, which decreased by an average of 2.4 percent nationwide.

Austin’s economic growth was spurred mostly by consumer spending and professional and technical services, according to the report. While manufacturing and durable goods decreased, technology-based industries continued to thrive in the area. Austin’s economy has grown approximately 35 percent in the last decade, and the last census showed a 48 percent increase in population in this highly desirable metropolitan region. Austin’s location in Texas has helped it to maintain a healthy economy, but the Brookings Institution report indicates that Austin easily outperformed other major cities in Texas including San Antonio and Dallas.

One major area of growth that has kept Austin’s economy strong is the health care field. Major health care insurers, service providers, and manufacturing concerns have flocked to Austin in recent years, drawn in part by the highly-trained workforce and the business-friendly attitude of Austin’s city leadership. The increasing population of Austin requires large-scale health care service providers, and in recent years more than $1 billion in health care construction and investment has taken place in the Austin area. This provides jobs for area residents; in fact, in 2009 health care employment increased 5.5% overall in the Austin metropolitan area in contrast to a two percent increase nationwide.

Austin’s diverse employment base is also cited as a reason for its economic success. In addition to health care employers, the state government, educational institutions, and many other corporate interests provide jobs for residents. The resilient housing market in Austin is due in part to the stability of these employers, along with consistent population growth creating constant demand for properties in the Austin area. Austin consistently ranks in the top tier of American cities for quality of life and economic opportunity, which attracts many businesses and individuals to the area.

The Brookings Institution report ranked three Texas cities in the top five cities in terms of economic growth. The top five in order are: Austin; Washington, D.C.; McAllen, Texas; Virginia Beach, Virginia, and San Antonio, Texas.

You can view the interactive map on the Brookings Institution website. Below is a snap-shot of the overall economic growth situation.

Brooking Insitution Map of Economic Growth

Offices and other commercial space in Austin are bucking the national trend of falling rents and difficult financing.

A recent Grubb & Ellis Company forecast lists Austin, Texas as the number one city in the nation for commercial real estate investment. Long considered one of the top ten markets in the U.S. for retail, industrial, multi-housing, and office real estate ventures, Austin tops the list for office real estate, beating out cities like Washington, D.C., Los Angeles, Houston, San Diego and Denver. Austin ranked seventh in the nation for retail investment opportunities; Los Angeles held onto the top spot in that category. Austin’s overall strong showing in the commercial market is the result of a number of synergistic factors that have allowed the area to weather recent downturns while remaining relatively unscathed.

Grubb & Ellis credited a strong local economy including government and educational sectors for much of Austin’s strong showing. Federal, state and local government agencies provide over 150,000 jobs in the Austin area, offering a stable employment base that has shielded Austin against the unemployment woes that have plagued other areas in recent years. During 2009, a year when many other major metropolitan areas saw severe job losses and worsening recession, Austin escaped the brunt of the economic downturn with an overall job loss rate of 0.7 percent.

Green technologies are bridging much of the employment gap. Solarbridge and Heliovolt have recently opened offices in the area, and Gemini Solar has begun construction on what will be the largest solar power plant in the country. The plant will be part of AustinEnergy’s overall plan to provide clean electrical energy to the region; located in eastern Travis County, it is expected to generate 30 megawatts of electrical power upon completion in 2010. These new expansions and construction projects will provide additional employment for Austin area residents, and are expected to stimulate growth in the local economy.

Austin’s real estate industry got another boost in a report by Oxford Commercial Inc., which showed that commercial office space leasing stabilized in the fourth quarter of 2009 after three straight quarters of steep declines. Prices for office space have increased in some areas, notably in the downtown area where demand is typically highest. The improvement in leasing figures is believed by most analysts to mark the beginning of an economic rebound in the Austin area. While Austin has experienced fewer difficulties than other areas, it has still felt some of the effects of the nationwide economic woes; this news along with the high ranking by Grubb & Ellis is expected to cement Austin’s position as one of the most desirable commercial markets in the nation.

Leander Commercial Listing by RE/MAX 1