From job market growth and real estate market appreciation to economic developments, it is no longer news that Austin, Texas, is experiencing an all-around boom. Its current boom has led to the influx of millennials and young families looking to buy their first home, but with the price of homes increasing quickly, you may be wondering about whether it is too late to buy a house.
With the recent lift on the construction ban in Austin, the growing job market, and the massive influx of tech companies and employees, Austin is projected to be home to almost 1 million people by the end of 2020. However, with a 7.01% increase in home appreciation over the last year, it is never too late to buy a house in Austin.
There are several reasons why buying a home in Austin is still a great idea, even amid increasing home prices and the massive migration of individuals to the area in recent years. In this article, we will highlight some of these reasons and why Austin is experiencing a shift.
Why is Austin Booming?
If you’re like many Americans watching the Austin area burst into the forefront of economic development, you may be asking yourself about the secret behind this boom. Today, the Austin area is tagged by many tabloids as the “City of Eternal Boom.” Below are some of the reasons why 65,586 people and counting have migrated to the Austin area within a year.
Blossoming Job Market
The frequent relocation of tech companies and businesses around the US has positively influenced the Austin job market. Currently, unemployment rates are at an all-time low at 2.7%, even far lower than the national average. Also, with a job growth rate of around 3.7%, Austin is ranked as the number one city for job seekers by Nerd Wallet.
In fact, 84 percent of the fastest-growing companies in the US have a branch in the Austin area. Companies such as Apple, IBM, and other fortune-500 companies are quickly moving into the region. Due to their massive relocation into the city, the job market and population rates are projected to experience an exponential increase by next year.
Affordable Housing Market
While the prices of homes and rents may be at an all-time high in Austin, when compared to cities with its type of demography and economic sphere, it is quite affordable. As of June 2020, houses retail at an average price of $401,999, and the cost of rent is around $1,453, which is significantly lower than metro areas like San Jose and San Francisco.
Most importantly, with more relaxed building codes/restrictions, a strong educational system, and buildable lands, coupled with a historically low mortgage rate, it is no surprise that the Austin real estate market is experiencing a boom.
One of the reasons behind the boom in the Austin area has been its ability to succeed on all fronts of the economy. From education and tech to health and sports, the Austin area has been able to drive up the supply of jobs and reduce unemployment rates down to 2.7%. Today, Austin is home to some of the best schools, 85 biotech labs, and over 3,300 tech companies.
Is It Too Late to Buy a Home in Austin, Texas?
With industry experts projecting a continual increase in not just the population of Austin but of its real estate and economy, it is never too late to buy a house. Recent studies by Mashvisor show that the median price of homes in Austin may rise to $523,100 by the end of 2020 to mid-2021. Now is most likely the best time to get in and start building equity.
Secondly, the Austin area currently boasts one of the lowest mortgage rates in the country even though it is high in the aspect of property taxes. Current mortgage interest rates for a 30-year, fixed-rate mortgage is at 4.2%, and 3.6% for a 15-year fixed in Austin.
Also, similar to the sudden increase that followed the 2016 election, many predict that the same will happen again after the 2020 election. With that said, we think it is never too late to get a mortgage at an excellent rate for your dream home in Austin.
Lastly, the continued thronging of individuals from metro areas like California to Austin may continue to increase the appreciation rates of the Austin real estate market. Studies by Wallet Investors reveals that the value of homes in Austin over the last 12 months have experienced an increase 12 times and decreased 0 times.
In a nutshell, Austin is more likely to continue experiencing a boom—unless there is a crash in the tech industry, which is far from happening anytime soon. With thousands of companies and individuals making the switch to the Austin area, buying a home in Austin is a great investment idea.
While there is no assurance on whether mortgage rates will continue to stay this low over the next couple of months or post-US election, you can easily refinance into a lower interest rate down the road.