Austin Metro Real Estate Blog

Austin Real Estate: The Time Is Right!

Phil Hutson (Austin TX Real Estate) — Fri, 23 Jan 2009 17:18:18 -0600

Although not entirely immune to a economic/real estate downturn, Austin, Texas, is at least not languishing in an economic slump like most of the rest of the nation. Austin's foreclosure percentage is relatively low, home sales are down but stable, MLS listings are still selling but at a slower rate, and buyers are fewer than a year ago, but the economy is still vibrant and sustained growth is gaining momentum!

Austin continues to benefit from recent changes in the real estate market creating more attainable housing than ever before. Here are 7 reasons why "the time is right" to own Austin real estate:

1) Austin is expected to lead the nation in real estate appreciation in 2009 with an estimated 4.8% rate.

2) Fewer families are selling their homes and Builder inventory is decreasing, so rises in new home prices are anticipated.

3) Interest rates are at historic lows, with the average rate for a 30-year fixed loan at about 5.5%.

4) The Austin MLS consistently has one of the lowest months supply of homes for sale, making this one of the healthiest markets in the country.

5) Compared to several major metro areas, Austin's cost of living index is lower, making home ownership not only attractive but attainable at all levels of the housing spectrum.

6) Texas has led the nation in growth, with Austin having the highest rate of growth at 3.2%, and the lowest unemployment rate in Texas at the end of last year.

7) Consistently ranked as "One Of The Best Cities To Live In" - diverse and vigorous economy, highly trained and dedicated workforce, healthy mix of sustainable industries such as technology, business services, education and government jobs, and some of the largest employers in the nation - Dell, AMD, IBM, Samsung, Whole Foods, and Freescale - are but a few of the reasons why.

Combine all this with the beautiful lakes, the Texas Hill Country, and some of the nation's top New home and Custom home builders and you'll see why "THE TIME IS RIGHT!"

Phil Hutson is President of Showcase of Homes, one of Austin's top real estate firms.

Austin Texas Real Estate In Top 25 Markets

Phil Hutson (Austin TX Real Estate) — Thu, 18 Dec 2008 16:27:05 -0600

Although not immune to the "real estate slow-down" epidemic sweeping the U.S., Austin, Tx., continues to trudge along with only a slight headache. It continues to be the bright spot in the state, and is currently ranked as the 6^th brightest real estate location in the nation. A relatively-speaking strong economy, the University of Texas, good schools, and simply a great place to live are only a few of the reasons why.

Top 25 Real Estate Markets
Rank	Market Areas	Forecast 2008
1.	Biloxi, MS	4.9%
2.	Salem, OR	4.7%
3.	Bismarck, ND	4.6%
4.	Spokane, WA	4.4%
5.	Yakima, WA	4.1%
6.	Austin, TX	4.0%
7.	Grand Junction, CO	4.0%
8.	Fargo, ND	4.0%
9.	Mobile, AL	3.9%
10.	Idaho Falls, ID	3.8%
11.	New York, NY	3.8%
12.	Glen Falls,NY	3.8%
13.	Salt Lake City, UT	3.8%
14.	Grand Forks,ND	3.8%
15.	Pascagoula, MS	3.8%
16.	Hattiesburg, MS	3.7%
17.	Albuquerque, NM	3.5%
18.	Kellogg, ID	3.5%
19.	Boise, ID	3.5%
20.	Provo, UT	3.1%
21.	Ogden, UT	2.7%
22.	Edmond, OK	2.6%
23.	Oklahoma City, OK	2.5%
24.	Amarillo, TX	2.4%
25.	Lubbock, TX	2.3%

Other Austin accolades include:

* Forbes magazine named Austin the 3rd city on a list of "recession-proof" cities due to its strong housing market, low unemployment rates, and growth in agriculture, energy and manufacturing, May ‘08
* Austin ranks 3rd Best City for Jobs in 2008 by Forbes.com, Jan. ‘08
* Popular Science names Austin as one of the top 10 green cities in the US, Feb. ‘08
* Austin ranks 1st in Fastest Growing Metros in 2008 by Forbes.com, March ‘08
* Round Rock ranked the 7th Best Places to Live in America by Money Magazine, July ‘08
* Orbitz.com lists Austin as one of the Country's top 6 movie landmark destinations, March ‘08
* Austin ranks as the 4th Best City in Overall Standard of Living by Expansion Management
* Austin ranks 2nd among the 50 Best Places to Live comparing the combinations of adventure, attractiveness, and affordability by Men's Journal

Contact me, Phil Hutson, Austin REALTOR, for a free 350-page Relocation Guide - a comprehensive resource for everything in Austin! Table of contents include: Business and Economy (cost of living, top 25 employers, etc.), Education (schools), Healthcare Resources (hospitals/healthcare facilities), Housing (area map, communities), Leisure (museums, theatres, wine tasting, etc.), Lake Living (all about the lakes), Shopping and Dining, and Getting Settled (moving resources, religion, etc.)

Emergency Economic Stimulus Plan For Homeowners - Take Action NOW!

Phil Hutson (Austin TX Real Estate) — Fri, 21 Nov 2008 11:49:05 -0600

Speaking not only as a long time REALTOR in Austin, Texas, but a homeowner, business owner, and concerned citizen, the $700 billion bailout plan intended to shore up the nation's lenders was a "necessary evil." I was politically opposed to the plan initially, but like a lot of others couldn't see any other option given the alternatives. The overall economy, and the housing market specifically, are in dire straights.

Without going into all the details of the $700 billion stimulus package because it covers a broad spectrum of ways to implement the hoped-for recovery, I would like to concentrate on one specific area - the "Housing Stimulus" section. I know it's still early, but suffice it to say the plan has unfortunately not been as effective as was hoped in improving the nation's housing market.

A few ideas have come out of the National Association of REALTORS® (NAR) Convention in Orlando, Florida, that just ended last week, that we as, not just REALTORS, but concerned citizens, should support. Congress may consider a second economic stimulus bill this month. If they do, there are a number of changes that could help to provide more stability to the nation's real estate markets which most agree is a necessary step towards recovery. If we ALL, not just REALTORS, contacted everyone in our database to contact their congressman for a positive vote, we could see a lot fewer foreclosures in the near future!

NAR has proposed a Four-Point Housing Stimulus Plan and has urged Congress to include the following provisions in any future legislation:

1)Make the $7,500 first-time homebuyer tax credit available to all buyers and eliminate repayment requirements. The credit's limited availability and repayment requirement severely inhibit its use and effectiveness.

2) Make the 2008 Federal Housing Administration (FHA), Fannie Mae and Freddie Mac loan limits permanent. New rules for 2009 will reduce the loan limits, but now is not the time to tighten mortgage affordability.

3) Get the Emergency Treasury bank relief program back on track and allocate more funds to mortgage relief. Create a federal mortgage interest buy-down program to make below-market rates available and stabilize home prices. The proposed rate buy-down is close to two points below the current rate.

4)Permanently bar banks from engaging in real estate brokerage and management. The banks have proven they have enough to do simply managing the loan process. They should not handle home sales and purchases as well.

To contact your congressman, click here.

Austin Custom Homes - $1,000,000+ Bargains

Phil Hutson (Austin TX Real Estate) — Thu, 06 Nov 2008 15:59:21 -0600

If you like it, and want it , and can afford it, it has never been more affordably priced!

The "it" I am referring to is not a new diamond ring or a new car, it's a luxury custom home with a price tag at or exceeding $1,000,000 in Austin, Texas. There are a lot of them for sale, and not too many selling. As of today, 11/06/2008, there are 526 of them on the market in the metro area, and sales are down from last year almost 40% - 216 have sold so far this year, compared with 354 total last year.

If you factor in the custom homes in the next bracket down, the $750,000 - $999,999 price range, the picture gets even bleaker. There are 413 of these homes on the market, some of them just moving into this category after being reduced by the listing Realtors. Another indicator that times are not good for luxury home sellers - since January 1, 568 of these homes, including both price brackets, have been listed for sale, and subsequently withdrawn from the MLS because they had not sold. Granted, some of these may have been withdrawn and later put back on the market, but this is still a staggering number!

There are several reasons for this scenario. Most obvious is the "economic epidemic" that is gripping the nation and certainly impacting real estate prices. Although Austin hasn't experienced the "flu-like" home symptoms most metro areas have, we do seem to have "caught a bad cold", especially in the upper price tier. Savings accounts and stock portfolios are being hammered, and a lot of these buyers were paying cash for these homes as little as last summer - cash that has suddenly vanished.

Second, with $1,000,000+ home sales going from 125 in 2003 to 354 in 2007, it was only natural that custom home builders from across the planet flocked to Austin to cash in! There are over 150 (this number is being reduced almost daily) custom builders in the Austin area, compared to about 40 production builders ($100,000 - $600,000). With a large custom home taking from 8-14 months to build, a number of these homes were started before the market starting going south earlier this year, and are now gathering dust.

Third, from a resale perspective, a number of sellers are simply looking to downsize their house payment, and/or moving out of state. This is , of course, natural attrition in a normal market, but this isn't a normal market, and the "downsizers" are abundant this year, and the "upsizers" aren't to be found!

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These $1,000,000+ homes are found throughout some of the most sought after areas - from central Austin to the lakes. A breakdown of these areas follows:

Area 1B: 50 homes for sale- (zip code 78703) includes Tarrytown, Hyde Park, and Pemberton Heights

Areas 8E & 8W: 118 homes for sale- (zip codes 78746, 78733, 78738) includes Westlake, Seven Oaks, Davenport, Lake Pointe, and Rob Roy

Area LN & LS: (Lake Travis) - 127 homes for sale- (zip codes 78732, 78734, 78738, 78669, 78641) includes Lakeway, Hughes Park, Spanish Oaks, Bella Montagna, Belvedre, Bella Strada, Flintrock, and Falconhead

Area RN: 53 homes for sale- (zip codes 78730, 78732) includes Steiner Ranch, Greenshores, Riverplace, Long Canyon, and Westminster

Area W: 48 homes for sale - (zip code78735) includes Barton Creek and Gaines Ranch

So, back to my original theme - IF YOU CAN AFFORD IT, COME AND GET IT - CHEAP (or at least, cheaper)! I have seen some of these homes discounted as much as $300,000. For the best prices, locations, complete market analysis and more on these homes, contact Phil Hutson toll free @ (888) 410-5858.

Benefits Of Relocating To Austin Texas

Phil Hutson (Austin TX Real Estate) — Wed, 05 Nov 2008 12:05:06 -0600

Accolades continue from a variety of sources for the Austin, Texas metro area, as to the potential for job-seekers, opportunists, and those simply seeking a better way of life/standard of living.

* Austin ranks 3rd Best City for Jobs in 2008 by forbes.com, Jan. '08

* Popular Science names Austin as one of the top 10 green cities in the US, Feb. '08

* Austin ranks 1st in Fastest Growing Metros in 2008 by Forbes.com, March '08

* Round Rock ranked the 7th Best Places to Live in America by Money Magazine, July '08

* Orbitz.com lists Austin as one of the Country's top 6 movie landmark destinations, March '08

* Austin ranks as the 4th Best City in Overall Standard of Living by Expansion Management

* Austin ranks 2nd among the 50 Best Places to Live comparing the combinations of adventure, attractiveness, and affordability by Men's Journal

Contact me for a free 350-page Relocation Guide - a comprehensive resource for everything in Austin! Table of contents include: Business and Economy (cost of living, top 25 employers, etc.), Education (schools), Healthcare Resources (hospitals/healthcare facilities), Housing (area map, communities), Leisure (museums, theatres, wine tasting, etc.), Lake Living (all about the lakes), Shopping and Dining, and Getting Settled (moving resources, religion, etc.)

Austin Texas Real Estate - Investment Opportunity

Phil Hutson (Austin TX Real Estate) — Wed, 05 Nov 2008 11:29:42 -0600

Eldon Rude of Austin MetroStudy gave his third quarter report, "Housing Update and Economic Outlook," last week, and I thought I would share some notes. In general, we have some ongoing challenges in our local market, but there are a number of factors that set us apart from more troubled parts of the country. We're not entirely out of the woods because of several possible national economic threats looming ahead, including - scarce availability of financing, selective corporate bailouts, scarce down-payment assistance, slowing job growth, and increase in foreclosures - but there are a number of positive signs, and as I've said in numerous articles, if you are looking for a place to relocate, Austin, Texas, should be high on your list!

Reasons include:

Texas continues to be number one in job growth, with Austin high on all national lists for jobs, property appreciation and low inventory of homes for sale.
Locally, Texas leads the nation in job growth, with 4 Texas metro markets in the top 10 for job creation, including Austin at #6.
Single Family new home starts are down 42% nationally. SF starts are down 41% in Texas, although Texas is still #1 on the list for new starts.
In the apartment market, occupancy is beginning to decline (at 91.4% city-wide), with rates flattening at $.98 per square foot on average.
In the resale market, inventory is holding at 6 months, although we should anticipate an increase in the spring when more homes come on the market.
Among sub-markets in the Austin area, Southern Travis County is still the most active in new home starts.
The highest months of supply of finished vacant homes is in Lake South, where sales have slowed around high price points. Other areas with over a 7 months supply are Hays West, Central South Austin, Central North Austin, and Round Rock/183.
Austin has the second lowest months of supply of new homes in all Metro Study markets nationally, second only to San Antonio. Austin is 4^th lowest in resale inventory of all Metro Study markets nationally, after Houston, Denver and Sacramento. This makes our market well positioned to experience an early recovery.
Economic boosters include: Austin has never experienced a "bubble" in home prices and prices are holding; inventories are manageable; foreclosures in Austin have remained moderate; Central Texas is poised for significant growth in population over the next 5-10 years; tight financing has created pent-up demand for homes that will give our market a boost when more financing options become available; businesses continue to locate in Austin
Forbes magazine calls Austin "Recession Proof" back in May - a bold statement that has a lot of merit, even in these tough "recession-like" times

Phil Hutson has over 20 years real estate experience selling Austin real estate, and is the Broker/Owner of Showcase of Homes.

Million Dollar Homes in Austin, Texas - Great Deals If You Do It Right

Phil Hutson (Austin TX Real Estate) — Fri, 31 Oct 2008 12:39:04 -0500

Hey Mr./Ms. Custom Home Buyer - think you're smart/sophisticated enough to find that super deal on that million dollar home you've always wanted? Don't be so sure.............

Although sometimes more sophisticated than your average home buyer, since typically the upper-end luxury home buyer is older (not necessarily true in the Austin area), has done this many times before, and has more time TO look, the standards of finding the "best" deal still prevail. The "best" deal is not always so obvious if data obtained solely from web-based sources (numerous "find-the-best-home" Internet sites) is the main, if not only, source of information. Having access/knowledge to data not found on the Internet is sometimes crucial to not only saving thousands of dollars on the price, but in finding a Custom Builder that is reputable and financially sound to service warranty issues after closing.

I say this because it ceases to amaze me the number of high-end custom homes sold every year in the Austin area without a Realtor. True, a number of these homes are contracted directly with the Builder on a to-be-built basis, but even that process could have been enhanced if the Buyer had first obtained the services of a reputable Realtor with experience in and with custom home sales - before the bid process, during architectural planning, through construction, and to final closing. The mere price of that million dollar+ mansion should NOT be the only consideration in a buyer's thought process, as so much more goes into probably one of the most expensive investments one will make!

Here are a few items to consider that are VERY important, and that most if not all custom buyers either have expertise in, knowledge of, or access to:

Inventory of available or soon-to-be-completed homes; access to all "appointment only" homes
Synopsis of selected Builder, community history (appreciation/depreciation), school analysis
Builder sites/lots available for construction
Market/cost analysis including site procurement (lot cost), price/sf, sold comparables, etc.
Architectural/structural/feature recommendations
Construction walk-through inspections through completion, and final inspection w/builder
Mortgage companies/interest rates (when applicable), and title and closing documentation review

Realtors that represent Custom/Luxury buyers are not usually the "rookies" in the office, but generally the more seasoned veterans that have done this before. In a previous post, Austin Real Estate Agent - Choose a Specialist, I mentioned qualities to look for when making a Realtor decision.

I built my own Custom home - I'd be glad to assist in helping build yours! With over 24 years experience, put my vast knowledge of the Austin Custom Home market to work for you! Contact Phil Hutson @ phil@showcaseofhomes.com, or call toll free (888) 410-5858.

Austin Real Estate Market Statistics

Phil Hutson (Austin TX Real Estate) — Tue, 28 Oct 2008 11:50:59 -0500

Area Market Statistics

Home Sales Stabilize in Austin Area

October 20, 2008 - Central Texas home sales remain steady, according to the latest Multiple Listing Service (MLS) report from the Austin Board of REALTORS®. The median price for single family homes in September remained unchanged from one year ago, while the number of homes sold inched closer to 2007 sales totals.

The 1,670 homes sold in September reflect an eight percent decline from one year ago. These sales contributed $406,955,620 to the local economy, down 11 percent from 2007. Meanwhile, the median price for single family homes showed no change from last September, remaining at $182,600.

Active listings for September rose two percent from one year ago to 10,217, while pending sales dropped ten percent to 1,520 and new listings fell 11 percent to 2,617. The average amount of time these properties sat on the market rose 18 percent from 2007 to 71 days.

"National economic troubles and limited access to credit continue to impact the local housing industry," says ABoR Chairman Socar Chatmon-Thomas. "However, Austin's economy has avoided many of the ups and downs experienced by other parts of the U.S., and our city is poised to remain on the forefront of the country's economic turnaround."

September 2008 - Single Family Homes

1,670 was the number of homes sold, down 8 percent from one year ago
$182,600 was the median price, unchanged from September 2007
$406,955,620 was the total dollar volume of properties sold, down 11 percent from last year

For a comprehensive home analysis for the Austin metro area contact Phil Hutson @ phil@showcaseofhomes.com or call toll free (888) 410-5858.

Austin Property Tax Rate Among Lowest in Texas

Phil Hutson (Austin TX Real Estate) — Mon, 27 Oct 2008 11:01:37 -0500

For the 2008-09 fiscal year, Austin, Texas, property tax rate remains lower than other major cities across the state at $0.4012 per $100 property valuation. For the average homeowner, this means a tax bill of approximately $988 a year.

The 2008-09 fiscal year tax rate of $0.4012 per $100 of property valuation is lower than last year's rate of $0.4034, but since home values are still climbing, the average homeowner will pay around $80 more a year to the city at tax time.

Tax rate decrease

With city-owned utilities making transfers to the general fund and substantial sales tax revenue, Austin is able to keep the property tax rate lower than other major cities in Texas. Ransom-Nelson said the average home price in Austin is up approximately $21,000 from last year to $246,352. Based on that valuation, a homeowner would pay $988.36 in property tax.

While the escalating property valuations will equal more tax revenue for the city this year, expenditures are increasing as the city tries to keep up with the growth. In a statement released during the budgeting process, Austin City Manager Marc Ott said the city will have to continue to keep a close eye on revenue in the coming years.

Growth is Slow But Steady

While the U.S. economy is experiencing turbulent times, the City of Austin projects that the local economy will continue to grow during the current fiscal year, but at a more moderate rate.

City economist John Ransom-Nelson said economic trends at the local level do not necessarily mimic those at the national level. "Because Austin is in a growth mode and expanding regionally, the city is less likely to experience the slowdown that is plaguing other areas," he said.

"It depends on where [a city is] situated when the economy does better or it does worse. Austin is building a bunch of apartment complexes, and the real estate market is still fairly strong at the time. It's eventually going to affect us, but not as much," he explained. New Home Builders are feeling a little pinch, as they continue discounting some inventory homes to attract buyers.

Austin Has a Slight Cushion

Austin is also made up of sectors less susceptible to economic slowdown. "You've got a state government here and a university that are, to some extent, recession proof," Ransom-Nelson said. "It doesn't mean that it's totally recession proof, but it's a large component of the makeup of Austin."

This "cushion" also helps the real estate markets in the surrounding communities like Round Rock, Pflugerville, Westlake, and the Lakeway/Lake Travis areas.

Lakeway at Lake Travis - Scenic Beauty in the Hill Country

Phil Hutson (Austin TX Real Estate) — Fri, 17 Oct 2008 15:44:50 -0500

The Location: 20 miles west of Austin.

The Numbers:

Established: 1963
Population: 8,002 from the 2000 census
Average age: 41 years
Current Median Home Price: $273,100
Who lives there: Families (non-single residences) represent 79.9% of the population, giving Lakeway a higher than average concentration of families. There is a healthy mixture of working Austin families, retirees and second home weekenders.

Snapshot:
Lakeway is a planned development consisting of approximately 5,500 acres of Texas Hill Country that stretches across meadows, hills and limestone cliffs to the shores of Lake Travis approximately 20 miles west of the Texas Capital - Austin. It is one of the most respected recreation oriented, planned communities in America. Lakeway blends extraordinary scenic beauty with controlled growth and quality recreational resources. The land rises and falls in a panorama of the Texas Hill Country, secluded valleys and wooded acres - from the average Lake Travis level of 681 feet mean sea level to a maximum land elevation of 1,174 feet.

Eat, Shop & Play:
The City of Lakeway, boasts a wide variety of shops and eateries. A visit to the Oasis, the "sunset Capital of Texas" Located 450 feet above Lake Travis, is a must!

The Academy of Golf in the Hills is the most advanced golf instruction center in the country. Its three holes, a par 3, 4 and 5, provide a range of challenges and learning opportunities with multiple pin placements, fairway bunkers, uneven lie mounds and varying cuts of rough. The Hills of Lakeway golf course is one of three golf facilities in Lakeway.

Located adjacent to the Lakeway Resort and Conference Center is the Lakeway Marina, the largest full-service marina on Lake Travis. There are more than 350 covered boat slips, as well as a parts department and fuel service. Daily boat rental (skiing, fishing, pontoon, pedal and runabouts) are available.

The Hill Country Galleria Mall is expected to become the new shopping mecca of southwest Austin. The project which includes many high-end retailers offers a shopping experience much like that of "The Domain" in North Austin, with its village type atmosphere.

Outside of the retail shops, the Galleria will also feature a 1.3-million-square-foot lifestyle center, which includes a 30,000-square-foot City Hall, as well as an amphitheater and multifamily housing.

For additional information contact Phil Hutson @ (888) 410-5858, or email phil@showcaseofhomes.com.

Pflugerville, Texas: Commercial Growth Should Ease Homeowner Tax Rate

Phil Hutson (Austin TX Real Estate) — Tue, 14 Oct 2008 16:41:52 -0500

For years, Pflugerville has had one of the highest property tax rates in the Austin area, but with five consecutive years of decreasing rates, Mayor Jeff Coleman said those days might soon come to an end.

"I firmly believe that in the next four to seven years, this city is going to have to make a dramatic decrease in the tax rate," he said. "By then, Stone Hill [Town Center] will be full, Verde [commercial development] will be full. It's just going to take some time."

City officials anticipate that commercial growth in Pflugerville will continue to push the property tax rate down, as it has done in other cities experiencing similar growth. But Coleman said it will take time for retailers to generate the substantial sales tax revenue needed to change the city's funding mix.

Growing pains, property values

On Sept. 23, the city council approved the 2009 fiscal year budget, including a half-cent decrease in the property tax rate. Homeowners will pay more next year in property taxes despite decreased rate.

The current city tax rate of $0.614 per $100 of property valuation will be lower than last year's rate of $0.619, but rising property values mean homeowners are likely to pay more at tax time. The value of an average home in Pflugerville is $169,791, and with the new rate a homeowner will pay $1,042.52 next year in city property tax - an increase of $25.20.

"In the 2000 [U.S.] Census, we had 16,000 people. Today, we have over 41,800," Coleman said. "In less than eight years we have grown drastically."

Rooftop market

Although the new rate is lower than last year's, it will still remain significantly higher than nearby cities such as Round Rock and Austin, with respective rates of $0.3652 and $0.4012 per $100. Coleman attributes this to those cities' more established commercial sectors and the amount of sales tax revenue they generate.

Pflugerville relies more on property taxes than neighboring Round Rock, which depends on sales tax revenue from Dell, Inc. for a large percentage of its general fund revenue. For 2009, only 14 percent of Pflugerville's general fund revenue will come from sales tax, and nearly half will come from property taxes.

City Manager David Buesing said cities like Pflugerville traditionally have higher tax rates to compensate for the lack of retail.

"We've got a rooftop market here and when that's mainly what you have, you have higher taxes," he said.

Coleman said even with higher property tax rates than nearby cities, Pflugerville homes are among the best values in the region.

"We feel like we have the most reasonably priced housing market in the northern Austin market," Coleman said. "You can buy more house [for the price] in Pflugerville than virtually any place in Central Texas."

Mixed messages

As the commercial sector develops in Pflugerville, the council wants to make the city a place where residents can also work.

"What we're really focusing on now is recruiting businesses that are going to bring employment bases into Pflugerville," Coleman said.

But as the city moves forward, Coleman said the council will do all it can to preserve Pflugerville's rural charm.

"Our goal is to maintain as much of that small-town, community feel as possible while implementing those aspects of a larger suburb, which are retail growth and commercial tax base growth."

The dilemma facing the council, Coleman said, is finding a compromise that satisfies citizens wanting lower taxes but not willing to see nearby green fields transformed into retail space.

"The city council receives a very mixed message depending on the project," Coleman said. "On one hand they say drop our tax rate and on the other hand they say don't change to do that, and we can't accomplish both things. We try to find a balance."

Source: Community Impact Newspaper

For additional information contact Phil Hutson @ www.showcaseofhomes.com.

Round Rock, Texas; New Schools Are Top Priority

Phil Hutson (Austin TX Real Estate) — Tue, 14 Oct 2008 10:53:28 -0500

An article by staff writer Lauri Zachry in the Round Rock Leader, the local newspaper serving Williamson County, caught my attention recently. Since I live in Round Rock, my kids attend school there, and about 40% of my home sales are in the area, I am very much attuned to what's going on in the community. But that being said, I was still amazed at the growth that this area continues to see, and hence ANOTHER bond proposal for MORE new schools!

The most recent bond election voters approved for the district was in November 2006. Voters approved four propositions totaling more than $267 million. Projects funded by the 2006 bond include the opening of three new elementary schools and one new middle school this fall. The district's fifth high school, Cedar Ridge High School, will open for the 2010-11 school year.

In spite of the last bond package passed only two years ago, and in spite of the Nov. 4 general election being dominated by the presidential race, Round Rock ISD wants to remind voters that a two-proposition bond package for $293.9 million will be there to vote on. Most of the first bond proposition is devoted to new facilities and schools. The first bond proposition totals approximately $156.6 million.

The district wants to construct three new elementary schools in the Stone Oak, Paloma Lake and Parmer Lane corridor areas. The Paloma Lakes subdivision is in the northeast quadrant of the district near U.S. Highway 79 while the Parmer Lane corridor is near the RRISD Athletic Complex. These two schools would accommodate up to 900 students. The Stone Oak elementary location will be a smaller school (for 700 students) located north of FM 1431 near the Stone Oak subdivision to help relieve overcrowding at Cactus Ranch Elementary.

RRISD will have four public hearings throughout October to provide input on construction for the new facilities, upgrades, technology and land and bus purchases. These public hearings will also give residents a chance to ask questions regarding the election. The dates and times for the public hearings are as follows:

· Oct. 14 - Westwood High School, 12400 Mellow Meadow Drive, Austin, and Round Rock High School, 300 Lake Creek Drive

· Oct. 21 - McNeil High School, 5720 McNeil Drive, Austin

· Oct. 28 - Stony Point High School, 1801 Bowman Road

The pro-bond Political Action Committee, Classrooms 4 Kids, also wants voters to be informed before making their decision regarding the school bonds, said Classrooms 4 Kids co-chair Raymond Hartfield.
"We want to get the awareness up of this bond election," Hartfield said. "Yes, you'll be voting for president, state representative and for county commissioners but we don't want people to forget about this important election too. Since people will be voting for school bonds, we want them to make an informed decision."

The second considered bond proposition is totaled approximately at $137.4 million for school additions and renovations, curriculum, more buses and technology infrastructure. The RRISD Citizen's Bond Study Committee presented bond package recommendations to the school board and the community June 5.

The citizens study committee presented its tentative list of new construction, upgrades and technology infrastructure projects May 19 during a public hearing in the lecture hall at Round Rock High School. The original list the group started with totaled almost $440 million, but the committee reduced the list to $350 million, even though the district bond finance committee suggested further reducing the list to $300 million, said Catherine Hanna, 2008 Citizens Bond Study Committee co-chair and Classrooms for Kids co-chair. "We had some hard decisions to make," Hanna said. "We really don't have any fluff on this list."

During earlier bond study committee meetings, the district considered creating a 500- to 700-seat auditorium in the eastern portion of the district, smaller, 600-seat auditoriums at Round Rock and Stony Point high schools and an alternative high school. The citizen's bond study committee was unable to justify displacing other needed priorities for the two auditoriums, said Dwayne Kostiha, citizens bond study committee co-chair, in June. The board had until Aug. 26 to call the bond election to be placed on the Nov. 4 general election ballot. Early voting for the November bond election begins Oct. 20.

For information about Round Rock, contact Phil Hutson for a free relocation guide, or call (888) 410-5858.

New Fannie Mae Guidelines Encourage Short Sales

Phil Hutson (Austin TX Real Estate) — Wed, 08 Oct 2008 15:56:50 -0500

This article might be of interest to those Realtors (like me) that never thought about trying to obtain "short sale" listings, and/or work with those lenders that have some of these potentials in their portfolio. There appears to be a huge "upside" for those homeowners that are about to be "upside down" in their mortgages, to work with their Realtor/lender to "short sale" this property BEFORE it actually goes to foreclosure.

New Fannie Mae Guidelines Encourage Short Sales

Fannie Mae recently released updated underwriting guidelines for new mortgage loans that directly address individuals with various types of foreclosure history. Potential borrowers with a foreclosure on their credit record must wait 5 years to be considered for new funding, and are subject to additional credit and down payment requirements for 5 to 7 years.Deed-in-lieu-of-foreclosures warrant a 4 year wait with additional requirements for 4 to 7 years.

Finally, the silver lining...Short Sales require only a two year wait with no additional requirements. These new guidelines make short sales a more attractive option for homeowners as well as provide realtors with a tremendous opportunity to assist distressed homeowners with a short sale AND future home ownership.

This information can be very valuable when meeting with short sale prospects. It certainly makes sense for distressed sellers to take note of this "better mousetrap" rather than foreclosure proceedings, and also makes sense for us Realtors to not only look at this as a new source of revenue, but more importantly as a way of helping a homeowner initially get out of a distressed situation, and eventually back into a home quicker than they ever imagined!

Austin New Home Builders Continue REALTOR/Buyer Incentives

Phil Hutson (Austin TX Real Estate) — Wed, 08 Oct 2008 15:19:15 -0500

I don't suppose it comes as any surprise to anyone that, as a buyer looking to purchase a new home, or a REALTOR searching for his buyer looking to buy a new home, that most New Home Builders are discounting heavily in order to move inventory. As I've noted in several blogs, the Austin metro area continues to outpace most other areas in home sales, but it is beginning to show signs of slowing. The foreclosure rate for the area is increasing, and a lot of people that had been looking to buy a new home will instead go for the much lesser price of a foreclosure. Even the smell of new paint and carpet will not overcome a 20-30% decrease in the market value of a foreclosed home price tag!

The Builders, anticipating this months ago, began offering incentives to both buyers and Realtors as enticements, and to help slow this attrition. As expected, the incentives were much less in the "hot" months from March-July, but starting about 6 weeks ago they really started "upping the ante"! Below are just a few of examples from several "production" Builders' ads:

DR Horton Homes - "5% commission on 30 day closing"; "up to $20,000 in buyer incentives (homes from $180,000-$210,000); "up to $50,000 in incentives (homes from $275,000-$325,000); "{6% commission/buyer closing costs paid"

KB Homes - "$0 down USDA loans still available"; "buyer discounts on ALL ready-for-move-in homes!"; "5% commission"

Standard Pacific Homes - "6% commission on closeout homes"; 5% commission on all specs"; 4% commission on New construction"; $10,000 buyer incentives

David Weekley Homes- "Up to $40,000 in FREE options"; "FREE trip w/airfare and accommodations to Cabo San Lucas"

Drees Custom Homes - "$5000 Realtor bonus on any home sold"; $30,000-$60,000 discounts"

Perry Homes - "$5,000-$25,000 Realtor bonus on all inventory homes"

Mercedes Homes - "Up to $30,000 paid towards closing costs"

Highland Homes - "Up to $30,000 in discounts"

There are approximately 40 "production" Builders in the Austin area, with most offering some type of promotion/discount/incentive. These are just a few examples. For a more complete list, go to Builder Discounts at www.showcaseofhomes.com.

Where's the Bottom, and When's the Rebound?

Phil Hutson (Austin TX Real Estate) — Fri, 03 Oct 2008 11:45:53 -0500

Have we seen the bottom of the housing market? In my opinion, NO. And although the Texas economy, specifically the Austin metro area, is still fairly vibrant, we are continuing to see declines in both number of homes sold, and price/sf. The "mortgage crisis" that has taken center stage the last few months will be corrected, and fewer homes will be sold because part of the correction will be a RETURN to legitimate methods by lenders to qualify potential home buyers! So where's the bottom, and when's the rebound?

Although every area of the country has "reasons why" their home market is down, I believe the answer(s) are somewhat generic as far as "bottoming out" and "rebounding". I'll cover these first, and then briefly mention my thoughts on a Texas specific "rebound" at the end.

What Has to Happen?

Two major events have to occur before the housing market will begin to bottom out. First, home prices have to stop falling, and second, investor confidence in the traditional U.S. residential mortgage must be restored. What must happen for home prices to stop falling?

The answer is a painful process. Prices fall when there are more houses for sale than there are buyers who want to buy (or can afford to buy). The abrupt "nuclear event" that occurred in July 2007 (see "Wall Street Implosion Causes Nuclear Explosion") shut off a substantial amount of demand for new homes almost overnight. The large group of low income home buyers that was active in the market in June 2007 was gone completely the next month. Meanwhile, new homes were still piling into the market. The excess supply has continued to grow as foreclosed homes are put on the market. This overwhelming imbalance of supply and demand caused prices to fall.

Prices will stop falling when the excess supply is eliminated from each local market. This can happen in only one way. First, new construction must be reduced to virtually nothing. This actually began in the Austin area last summer, as New Home Builders began renegotiating their "take-down" schedules on lots from developers,and started various "Buyer incentive/discount" programs. The relentless population growth in most of America will ultimately absorb the excess inventory. The inventory of unsold homes will decline until selections get too limited to meet the needs of picky home buyers. At this point the market will begin to shift from a buyer's market to a seller's market. Prices will stabilize, and the market will begin to heal itself.

How Long to Heal?

The pace of this turnaround will vary from city to city. If home builders cut back dramatically on new supply, the recovery will occur faster. Communities with fewer foreclosures will work through the excess supply more quickly. Communities like Austin, Texas, with strong job and population growth will create demand that will absorb the excess units faster. Conversely, communities with slow job growth could take years to bounce back from the excess supply. Political action could change the timeline as well. If the Federal government were to offer tax credits for people to buy homes, the excess inventory could be soaked up even faster. This would cause the housing market to bottom and turn around much faster.

Another stimulus that would speed the recovery is gently rising mortgage rates. Typically, when mortgage rates are falling, homebuyers postpone buying. But when they see that mortgage rates have stopped declining and may rise, they hop off the fence and buy. As the economy begins to rebound in 2009, look for mortgage rates to take an upward turn. As long as rates do not increase dramatically enough to impact affordability, this should stimulate housing demand.

What About Texas?

The long-term outlook for the Texas housing market is clearly strong. In the 1970s and 1990s, house prices in Texas rose in nine out of ten years. And even in the 1980s - the most challenging decade for Texas in the past 38 years - house prices increased eight out of ten years.

Job growth in Texas has doubled the national average for most of the past ten years. Demographic experts estimate another 13 million people will live in Texas by 2030. Many Texas cities still have tight inventories of homes for sale with prices continuing to appreciate. The state's metropolitan areas have strengths and weaknesses in their local markets. Attractive properties located in older neighborhoods close to downtown, like Hyde Park and Tarrytown in Central Austin, are still performing well and will continue to do so. The challenges in big city housing markets will be in select sections of the suburban perimeter. In the short term, these markets will struggle because too many new homes have been built. Even in the hot home markets around Austin, like Round Rock, where home sales have been very good, sales have dropped off substantially since the first of the year.

But even in these areas, supply is being quickly withdrawn as new home starts plummet. It may take a few years for these areas to return to a balanced supply. For now, builders are accepting substantial concessions to make a sale. If you plan to buy a house to live in for a number of years, this would be a great time to buy. If you think you may not live in a house for two years before you move again, you might be better off to rent.

For a comparative market analysis of the Austin, Texas, metro area, contact Phil Hutson @ (888) 410-5858 or phil@showcaseofhomes.com

Wall Street Implosion Rivals Nuclear Explosion

Phil Hutson (Austin TX Real Estate) — Thu, 02 Oct 2008 12:20:05 -0500

(Picture depicts U.S. House of Representatives vote on 8/29/2008 re: "Wall Street Bailout")

The Fallout Has Just Begun

How in the world did we get here to begin with?

Over a year has gone by since the real estate mortgage markets experienced the first day of "nuclear winter." For three or four years prior to July 2007, the credit markets for real estate lending were on fire. The thinking among the "smart money" on Wall Street was that under modern central bank policies, risk was a thing of the past. The economy would still move up and down, but in much gentler waves, and when things got rough, the Fed could fix it.

"Fix-It" Fed

Remember the Y2K crisis? The Fed fixed it. Remember the stock market difficulties after 9/11? The Fed fixed them. Remember the 1998 Russian ruble crisis and the ensuing credit market turmoil it caused? The Fed fixed it. Even when the stock market crashed in October 1987, the Fed fixed it.

These examples prove the Fed will not tolerate more than minimal corrections in the U.S. economy. Investors have now succumbed to the notion of "The Greenspan Put." This catchy little phrase essentially means there is no longer any risk in the markets that the Fed cannot fix by lowering interest rates. When global investors perceive no risk, investment capital flows everywhere. Investment prices go up and yields go down. Cap rates on real estate hit record lows. In this kind of environment, how do investors find higher yield? The answer is that they take on more risk. They make home loans to people who cannot afford to pay them back. Then they sell those loans to investors who do not know what they are buying. Who cares? The profits roll in, and that's all that matters!

Housing Wheel of Good Fortune

This new "no risk" era has had a remarkable impact on the housing market. Prices started rising and suddenly homes were no longer just places to live - they became investments as well. As prices continued to escalate, investors figured if one house was a good investment,why not buy more? TV shows began to reflect the popularity of investing inhomes. Investors could tune in to "Flip This House," then switch channels and watch "Flip That House."

In post-World War II U.S. history, there have been three barriers to buying a first home: a down payment, a job and good credit. But early in this decade, the desperate search for yield prompted investors to buy riskier mortgages. Lenders had a new way of doing business. No job? No credit? No cash? No problem! They began making 100 percent loans without documenting borrower financials. Traditional risk management and mortgage underwriting standards that had served well for decades were swept aside. This new type of mortgage lender went by the name of Wall Street. Mr. Street did not need Fannie Mae and Freddie Mac underwriting guidelines because he did not sell his loans to Fannie and Freddie. He sold them to all kinds of investors all over the world. These loans were supposed to be virtually riskfree, rated AAA by the most reputable ratings agencies.

In 2006, prices stopped going up. Then they started to decline. Some people stopped paying their mortgages. Suddenly, investors decided not to buy more U.S. residential mortgages from Mr. Street. At this writing, those investors still are not interested in buying new mortgages. So guess who is left to make the loans? The traditional lenders who made them back in the good old days. Even an old friend - FHA - quickly evolved into the subprime lender of the 21st century.

And Then The Music Stopped

America finally woke up September 29, 2008, when, after weeks of debate and discussion about "our troubled lending institutions - especially MORTGAGE lenders - our beloved political leaders stepped to the plate and said "we are NOT going to allow the FED to fix it this time", and the picture above "tells the rest of the story."

What Happens if My Builder Goes Bankrupt?

Phil Hutson (Austin TX Real Estate) — Thu, 25 Sep 2008 11:46:00 -0500

In today's troubled real estate market across the nation, this is a question many of your buyers may have already asked you. If so, did you give them the right advice? This was the question posed to Mr. Don R. Hancock, a lawyer with over 35 years real estate law experience here in Austin, Texas, and partner in Hancock & McGill, L.L.P., attorneys at law (excuse the LONG answer - he IS a lawyer, remember - but worth reading to the end.) State laws may vary, so be sure and check with your local attorney before reciting his answer verbatim, but this is something we as REALTORS need to know! Even though our RE market in Austin is healthier than most across the nation, a new home builder here and a few custom home builders have already filed for bankrupcy protection.

He actually broke the question down into three parts relating to the bankruptcy of a home builder: First, can a buyer rely upon a contract with a builder after bankruptcy? Second, what happens to funds paid to a builder in bankruptcy? Third, should a buyer consider contracting with a builder in bankruptcy?

"For our purposes, there are two categories of business bankruptcies: a Chapter 7 bankruptcy and a Chapter 11 bankruptcy. Under a Chapter 7 bankruptcy, the builder is out of business and the bankruptcy purpose is essentially to distribute remaining assets to claimants. Under a Chapter 11 bankruptcy, the builder is attempting to re-organize, stay in business and continue to build and sell homes. I will limit the discussion to Chapter 11 bankruptcies.

Can a buyer or homeowner rely upon the contract he has with a builder, if the builder files for protection under Chapter 11?The answer is a qualified "NO!" The builder, as part of the bankruptcy process, can reject the contract without the consent of the buyer. However, the builder cannot unilaterally modify the terms of the contract. It is an all or nothing proposition. The builder can either honor the contract as written or terminate it. If both the builder and the buyer want to negotiate changes in the contract, that is permissible, but both parties have to agree to any changes.

What happens to funds paid to the builder? If the contract is terminated or if the builder commits a material breach of the contract terms, can the buyer recover the funds paid to the builder? The answer depends upon how the funds paid to the builder are classified for bankruptcy purposes and whether the builder has sufficient assets to re-pay the funds. Generally, funds paid to a builder will fall into one of two categories. They will either be a deposit for work to be done or they will be trust funds. If an owner has contracted with a builder to construct a home on a lot owned by the homeowner, funds are typically paid to the builder as construction progresses. If funds are advanced to the builder for the purpose of paying subcontractors and material suppliers, the funds are usually classified as trust funds in the hands of the builder. These are funds entrusted to the builder to pay third parties. If the builder breaches the implied trust and does not pay the funds to subcontractors and suppliers, this may be determined to be a fraudulent act and may subject the officers and other employees of the builder to personal liability for re-payment of the funds.

There might also be criminal penalties but these are rarely enforced. When a buyer contracts with a builder for a home to be constructed on property owned by the builder, the builder typically requires a deposit when the contract is signed. If the plans and specifications for the builder's "stock" home are substantially altered, this deposit may be thousands of dollars. There is some protection for these deposit funds when a builder files bankruptcy, but not much. The bankruptcy code allows a priority claim for up to $2,425 for each consumer (a husband and wife would have a combined $4,850). A priority claim can elevate a claim in front of certain other claims and provide a better chance of recovering the funds. Two factors limit the protection afforded. First, the amount is limited to $2,425 per consumer. Second, even if the buyer has a priority claim, no funds will be received if there are no funds to pay the claim. Builders who are in bankruptcy may offer to hold all deposits as "trust funds." This may provide some limited protection.

If you are considering contracting with a builder in a Chapter 11 bankruptcy who offers to hold funds as trust funds, you should: require that the builder obtain bankruptcy court approval for the trust fund arrangement; require a specific written trust agreement; and require that all funds be held in a separate bank account with no other funds commingled. Even if you take the precautions outlined above and the deposit funds become trust funds, you may not be able to recover them if the builder does not honor the trust agreement and spends the funds. You might have a lawsuit against the officers of the company who participated in spending the trust funds, but if there are no funds to be had, you may not recover. A better choice for holding trust funds is to insist that they be held by a third party, such as a title company, under a specific written trust agreement.

The final question is: should a buyer consider contracting with a builder in a Chapter 11 bankruptcy? This question is difficult to answer because it depends upon so many factors. I can tell you that building a home is inherently more risky than simply purchasing a completed home, even if the builder is not in financial difficulty. When it is apparent that the builder is already in financial difficulty, the risk is substantially increased. If an owner is considering contracting with a builder in bankruptcy, they should seek competent legal counsel before signing the contract to make certain they fully understands the risks."

Texas vs. California - Champagne vs. Miller Lite Home Tours??

Phil Hutson (Austin TX Real Estate) — Tue, 23 Sep 2008 16:38:13 -0500

I'm sorry - I am still laughing as I write this blog! Everyone (including native Californians) admits that California beats to a little bit different drummer, and an article I just read is just one more reason to believe it!

The headline for the article was a bit of a surprise in itself - "Food becomes big factor in California home tours" - because ever REALTOR knows the only reason to go on home tours IS for the food, not to preview the homes! But as I continued reading the article, it became clear that the reporter wasn't talking about food being served, but rather the KIND of food being served, and that's where I began chuckling. Her article describes what it now takes to get a California REALTOR to attend one of these tours, and my mind began comparing that to what it takes to get a Texas REALTOR to the same type event.......................

You see, I know a little about what it takes to get an Austin, Texas, REALTOR to attend a sponsored event like this. Many years ago I worked for a local Builder as an on-site sales agent, and about once a month I was required to hold a "REALTOR OPEN HOUSE", the purpose of which was to invite as many REALTORS as possible to come out to the neighborhood and preview your model home and available inventory.

It didn't take long to recognize the better the food being offered, the better the turnout. So, instead of cheese and crackers and tea, I served beef fajitas and beans and beer; instead of tofu and salad and bottled water, I served hamburgers and hot dogs and beer; and instead of turkey sandwiches and chips and green tea- if I REALLY wanted to impress! - I had either Gumbo's (a local seafood restaurant favorite) cater their delicious shrimp and sausage gumbo with a cold beer - OR - Rudy's BBQ brisket and potato salad and of course, an ice-cold Miller Lite - now that brought 'em out in herds!

Now here's where it gets interesting - you'll notice from the above that the best attended parties had something to do with BEEF and BEER - and below I will compare that to the Californians' taste.

The article reads:

Food becomes big factor in California home tours

By Ann Brenoff
LOS ANGELES TIMES
Sunday, September 14, 2008

LOS ANGELES - Apparently, the way to a real estate agent's heart is through his or her stomach.

With buyers continuing to hide in the weeds and the price of gas still stinging, brokers have had to improve the curb appeal of a principal marketing strategy. The so-called agents caravan - in which, on a designated day, agents tour one another's new listings - has upped the ante. No longer is the mere thrill of previewing a new listing enough to bring out the troops. Now they must be fed, and fed well. Alan Mark and Tony Mark of Prudential Malibu Realty recently provided omelets - cooked to order by a private chef- to those agents who made the trek to their new $36 million Broadbeach Road listing. With a salad and pastry bar on the side, agents could order their omelets prepared with 20 different fresh fillings. Spinach with feta cheese, anyone? Champagne? (Austin REALTORS might get migas and breakfast tacos, and an orange juice!)

Addictively good delectables also play a role. Freshly baked chocolate chip cookies by Coldwell Banker Malibu East agent Susan Monus - are a huge draw in this coastal community, according to area agents. She makes the cookies from scratch and, because presentation matters when it comes to both real estate and baked goods, displays them in a fancy silver bowl. For agents on the run, Monus also offers them in personalized cookie tins with her logo - to go. (Austin REALTORS are lucky to get Oreos without the white stuff already gone, served in the package! The only "personalized logo" item I ever got at an "open house" were these little candies "personalized" with M&M stamped on them!)

Wailani O'Herlihy, who sells with her husband, Cormac, out of Sotheby's International Realty, Malibu, says that in the summer, mocha frappés blended on-site are a crowd-pleaser. (Are you kidding me - mocha frappes? I don't even know what that is - our Texas summer specialties are frozen margaritas served from a machine!)

Drew Fenton of Hilton & Hyland, Beverly Hills, always hires a professional caterer who sets out a buffet. It's part of his marketing budget and the cost of doing business, he said, and most of the open houses he visits are professionally catered. (Drew, most of the open houses I visit I notice the local REALTOR "catering" the food himself - from the back of his SUV to the kitchen!)

And last-but-not-least, the Texas vs. California winner is:

Not far away on the same day, the agent for a home leasing for $41,500 a month was seeing far less traffic with a plate of vanilla cookies, two liter-sized bottles of water and a stack of cups. Michael Libow, Coldwell Banker Beverly Hills South, says of open houses with more ample spreads, "One of the problems is that you draw in agents not looking to do business but who are looking to do lunch". Fully catered lunches, he believes, are a distraction. (Michael, not in my town..... in Texas, a home leasing for $41,500 a month is generally on about 250 acres and is called a ranch. For this "open house' we would invite the President, Willie Nelson, and every REALTOR in Austin would be there! And for food? We're talkin' T-bone steak, BBQ brisket & ribs, smoked venison, stuffed quail, Miller Lite, and Wild Turkey - and I don't mean the kind you eat!)

Now I know why California is the only state in the Union that has a Terminator for a Governor...........!

Hard To Feel Blue, When You Just Got Tattooed!

Phil Hutson (Austin TX Real Estate) — Wed, 17 Sep 2008 15:18:10 -0500

As most of you in the business already know, our mortgage industry and housing industry is in a mess right now! A lot of the blame goes directly to the institutions themselves and/or the CEO's running them, part of the blame is the Feds, and the consumer gets to pick up the pieces - pieces of their lives, that is, which is now in shambles! What a mess! I could write 5-6 pages about my thoughts on this subject, but I'm not - not on this blog anyway.

What I do want to rant-and-rave/vent about briefly is a topic vaguely related to the above. To all the home owners that have been taken advantage of by the "industries" I have complete sympathy - to a degree. Momma always said "if it was too good to be true, it probably should be avoided", but trying to tell that to a first-time home buyer with a chance to own a home with "no money down", in an area that before he had thought "less than desirable", with a Builder that before he had considered "less than desirable", and in a home that, even though it was "bigger than he needed and REALLY stretched his budget - but I can handle it " mentality, was like trying to take candy from a baby - wasn't going to happen.........UNLESS THEY HAD ASKED ME!

I saw a report on one of the local news channels the other night, and the reporter was interviewing several people that had bought homes, and the people were all complaining about how they had "not understood the loan documents", "the Builder had not explained the HOA exclusions", "the loan officer had not explained the 'recapture tax' on this government subsidized loan", "the Builder's on-site agent had not told her ALL the exclusions in the model home from the one they had built", etc., and ONE OF THE PEOPLE THEY INTERVIEWED WAS A CLIENT THAT HAD GONE BEHIND MY BACK AND BOUGHT A NEW HOME WITHOUT CALLING ME!! I got tattooed! Did I feel sorry for her? NO! I had told her NOT to use this particular mortgage company because I had had previous bad dealings with, but she "got a better finance rate" than the company I had advised her to use - so she gets mad at me and cuts me out of the deal.

Now ALL of us, especially those of us that have been in real estate brokerage for as long as me (24 years), have been tattooed at least once or twice or eighty-four times in our careers. Part of that is my fault for not getting EVERY potential buyer to sign a "buyer/rep" agreement (not ALL will!), so 'my bad'. But I had a relative use another REALTOR instead of me because they knew "their/son/daughter/aunt/uncle/hairdresser", and THAT REALTOR sold them a house in an area I knew had "bad soil', and within 6 months their house had several cracks in it - AND THEY GOT MAD AT ME FOR NOT TELLING THEM! I would have if I had been your REALTOR stupid!!!!!!!!!!!!!!!! Do I feel blue - NO! tattooed - YES!

One of my (ex) best friends bought a home from a Builder new to Austin that they knew nothing, but that I was very excited about. So, I sent them to go see the model, and said call me back and let me know what you think. After repeated attempts over the next 3-4 weeks to contact this best (ex) friend, I found out from the Builder's agent that they had bought a home from her because she had discounted the home $15,000. She asked him if he had an agent and he said "no". When I eventually confronted him, he said he was afraid he would not have gotten that much discount if I had been paid a commission. Someday I will tell him that I had sold the same floor plan to another couple two weeks before, and had gotten them a $25,000 discount, and granite kitchen counter-top upgrade, and sodded back yard at no additional cost!!!!!!!! Do I feel blue that HE got tattooed - no!

My whole point of this 'gotta-get-this-off-my-chest-and-now-I-feel-much-better' blog is - while a large percentage of consumer housing woes are the fault of "the system", a small percentage of these woes could have been avoided with the help of a good REALTOR. I get tired of our industry being ranked with snakes, lawyers, and used car salesmen, being categorized with "junk-yard dogs", and constant gripes about "not worth the commissions" we get paid..........The sooner the public quits worrying about "what we PUT in our pocket" and starts looking at "what we KEEP in theirs", the sooner the rhetoric will cease.

One of the questions I ask on my web site, under the "WHY PHIL HUTSON" page, is this:

Second question: what do you do for a living? I bet the answer is NOT "...help people buy a home". In fact, most people only buy a home for themselves, and do so maybe 3-4 times IN THEIR LIFETIME! And a few still do so without a REALTOR! So, my next question is: what makes that person think he's a professional in the "home-finding" game, when they barely qualify as an amateur?

So now once this great news flash hits the airwaves can I expect my phone to start ringing with potential buyers clamoring for my services? Probably not - but I will celebrate my stress relieving blog tonight with a fine cigar and a couple of rum-and-cokes, and try to figure out where I can find another best friend.......................

Austin Texas Economy - Still Growing

Phil Hutson (Austin TX Real Estate) — Wed, 17 Sep 2008 12:54:47 -0500

Tuesday, September 16, 2008 - 5:00 PM

Austin economy ranks 4th on Milken/Greenstreet list

Even in a tougher economy Austin is still outperforming many other areas of the country in job creation and other economic markers.

The Austin-Round Rock region ranks 4th among the country's largest metropolitan areas on the Milken Institute and Greenstreet Real Estate Partners' 2008 Best Performing Cities list. That's a dramatic improvement from Austin's 20th place ranking on last year's list. The list ranks cities according to a series of matrices such as job creation and salary and technology growth.

Provo-Orem, Utah; Raleigh-Cary, N.C.; and Salt Lake City, Utah, were the top ranked cities on the list, in that order.

Among other Texas metro areas, the McAllen-Edinburgh-Mission region ranked No. 7 on the list followed by Killeen-Temple-Fort Hood at No. 13, San Antonio at No. 15, Houston at No. 16, and Dallas at No. 23. To see the full rankings, click here. That's not to say we are immune to the real estate downturn as our foreclosures continue to climb, but relatively speaking the Austin metro area is still fairly healthy in comparison to several other markets in the survey.

I also noticed the Midland-Odessa area in west Texas, where a HUGE chunk of our nation's oil deposits are, is experiencing a re-birth of it's economy (place cursor over Texas and see where the #1 "Top 5 Small Metro Areas" is)! Needless to say, with a barrel of oil well exceeding $100/barrel, this area is booming! I was out there several weeks ago visitng my sister and staying at her newly constructed home - a home that costs her $125/sf to build, that 5 years ago could have been built for around $95/sf!!

Green Building - Big and Getting Bigger

Phil Hutson (Austin TX Real Estate) — Fri, 12 Sep 2008 13:40:56 -0500

It's a reality we all have to come to terms with: Neither oil nor natural gas prices are likely to come down any time soon. World demand for oil isn't abating (read China and India). Hurricane Katrina fallout is plaguing the pumps, and as I write this Hurricane Ike is chewing up the Gulf and shutting down more refineries! And with monthly energy bills and relentlessly thirsty cars reminding us of our escalating cost of living, there's one message consumers are ripe for today: saving money on their home utility costs.

Home Builders across the nation are turning to what appears to be not-just-another-marketing-scheme to sell homes, but a real-life way of doing business - building green. For those that have not yet heard the expression, green building is the practice of using environmentally sound building techniques that conserve resources and provide for healthier living. The term "green building" generally refers to construction which incorporates some or all of the following: energy conservation, resource conservation, waste reduction, preservation of indoor air quality, and promotion of alternative means of transportation. The goal? Buildings that are less expensive to operate, healthier to inhabit, more durable, and better for the environment.

Clark Wilson in Austin, Texas, past President and CEO of Clark Wilson Homes, sold his company several years ago to Capital Pacific Homes, but recently re-emerged under the new banner of Wilson Family Communities. The company web site is conspicuously named www.greenbuildersinc.com, and guess what their "claim-to-fame" is - quote: "Green Builders^TM is one of the nation's largest builders and developers of green homes and green communities. We make it a priority to fully embrace sustainable building practices and to use earth-friendly products and materials whenever possible. Green Builders applies these practices in the earliest stages of development, yielding the greatest results in building green homes." Although not the only Builder in Austin building green, they are the first to 100% market their company as such.

A new survey of home builders released by Lowe's at the recent 2006 International Builders' Show demonstrates that one of the biggest trends in home building is a strong focus on energy-efficient materials and products. In fact, nine out of ten builders surveyed say they are incorporating energy-saving products into new homes, at all price levels.

Even the Fed's are getting involved. Fannie Mae's energy-efficient mortgage program, available for loans under $359,650, lets borrowers qualify for a bigger loan than they might otherwise and allows energy improvements to be financed-up to 15 percent of the appraised value of an existing home and up to a 5 percent equity credit on new construction. Under the program, an independent energy rater recommends energy-efficient improvements and itemizes what those changes will save the buyer.

A similar program from FHA allows buyers to borrow up to 5 percent of the appraised value of the home for improvements ranging from $4,000 to $8,000. Borrowers' housing payments can be 33 percent of their income instead of the typical 31 percent, and the total debt ratio is 45 percent, up from 43 percent.
Joel Wiese, a manager with mortgage lender Indigo Financial Group in Lansing, Mich., says 70 percent of his business nationwide involves energy-efficient mortgages.

And Sweden? Check out this headline: ▲Sweden Plans to be Oil-free by 2020

Feb. 8, 2006 - Sweden is to take the biggest energy step of any advanced western economy by trying to wean itself off oil completely within 15 years - without building a new generation of nuclear power stations. The attempt by the country of 9 million people to become practically oil-free is being planned by a committee of industrialists, academics, farmers, car makers, civil servants and others. Energy ministry officials in Sweden said they expected the oil committee to recommend further development of biofuels derived from its massive forests, and expansion of other renewable energies such as wind and wave power. The Guardian

And Canada? ▲City of Toronto Leads North America with New Green Roof Policy

Feb. 6, 2006 - The Toronto City Council has adopted the first comprehensive set of green roof policies in North America. In addition to reducing energy consumption and smog, research supporting the new policy found that 8 percent coverage of existing rooftops with extensive green roofs would generate over $300 million in initial cost savings in areas such as stormwater management, combined sewer overflow reduction, building energy savings, and urban heat island reductions. Operational cost savings for the city from this level of coverage were calculated at approximately $40 million per year. GreenBiz.com

And Walgreens? ▲Walgreens to Harness Power of the Sun

Jan. 12, 2006 - Drugstore giant Walgreens announced plans to install solar electric systems in 96 stores and two distribution centers in California and 16 stores in New Jersey. Solar roof tiles will enable each facility to generate between 20 percent and 50 percent of its own electricity on site. The new systems will generate more than 13.8 million kilowatt-hours per year, making this the largest solar project ever completed in the United States. Solarbuzz.com

This concept is a snowball going downhill - it will only get bigger as it gains momentum. For some developers, green home building is the long haul, the inevitable future of the industry. The green industry's growth will likely make it a more competitive -- and perhaps cheaper -- field in the next decade as more companies jump into the fray. And the cheaper it becomes, the more customers may buy into it.

Austin New Home Builders Customer Survey

Phil Hutson (Austin TX Real Estate) — Fri, 12 Sep 2008 12:31:59 -0500

J.D. Power ranks home builders/Pulte, Centex among market leaders

By Inman News, Wednesday, September 10, 2008

Brands of Pulte Homes Inc. ranked highest in customer satisfaction in a New-Home Builder Customer Satisfaction Study released Wednesday by J.D. Power and Associates. Overall customer satisfaction for all builders was 779 on a 1,000-point scale in 2008, J.D. Power reported, which is up from 741 in the 2007 survey, with overall satisfaction increasing in 28 of 29 markets that were surveyed in both 2007 and 2008. The 2008 survey includes 33 U.S. market areas.

Austin, Texas, was one of the 33 markets included in this survey, and the local results were slightly different than the national tally. David Weekley, Centex, and Standard Pacific Homes were the top three vote recipients, with David Weekley Homes receiving the Grand Overall Award for customer satisfaction. Several other Builders including DR Horton, Highland, Kimball-Hill, Legacy, Mercedes, and Ryland also scored highly.

Nine factors drive overall customer satisfaction with home builders (listed in order of importance): builder's sales staff (15%); builder's warranty/customer service staff (15%); workmanship/materials (14%); price/value (14%); home readiness (13%); construction manager (13%); recreational facilities provided by the builder (7%); builder's design center (6%); and location (4%).

"Home builders have adapted well to changes in the market that have necessitated a shift from an order-taking mode to an intensified focus on sales service and negotiation with prospective home buyers," said Paula Sonkin, vice president of the real estate and construction industries practice at J.D. Power and Associates. Strong home-building companies have recognized the importance of offering superior product quality, delivering homes on time and providing skilled sales staff in order to excel in hyper-competitive markets," said Sonkin. "With more negotiation occurring during the sales process, home buyers are receiving larger sales incentives. In addition, upgraded features that used to be considered options-such as granite countertops-are now being included as standard, which increases the perceived value of the home and subsequently results in increased satisfaction. With new-home prices on the decline in many areas, as well as larger inventories and renewed efforts of home builders to truly delight customers, it's a great time for consumers to consider buying a new home."

The study also finds that more than nine in 10 new-home buyers (92%) report receiving sales incentives. Among home buyers who report receiving incentives when purchasing their home, the average sales incentive totaled more than $16,500. The types of incentives that home buyers report receiving most often include a reduction in the base price of the home and credit toward options and upgrades.

For information on local Builders, and/or updated information on New Home Inventory discounts, contact Phil Hutson at (888) 410-5858, or go to www.showcaseofhomes.com.

Austin Real Estate Agent - Choose a Specialist

Phil Hutson (Austin TX Real Estate) — Fri, 05 Sep 2008 16:17:42 -0500

For most people, finding the right home starts with finding the right Realtor. Notice I said the RIGHT REALTOR. Do your homework for a REALTOR just as you would your homework for a house. There is so much more that goes into purchasing a home than just facts, figures, and pictures on the Internet, and a good REALTOR is one that can and will be able to sift through this information, develop opinions and offer advice about such, and implement the strategies to achieve your ultimate goal of home ownership.

Can you find the perfect home WITHOUT a REALTOR? Sure, and you could also either accidentally or by sheer luck win playing Texas Holdem' in Vegas without reading a book by Doyle Brunson, shoot a caribou in Alaska without an experienced guide, and win in a court-of-law without an attorney, but why leave it to chance? You can hire a professional REALTOR assisting you as your exclusive "Buyer's Agent", and have the seller pay for these services! And herein lies the theme for this blog - finding the right Realtor TODAY means finding the right SPECIALIST!

When I started in this business in 1984, we didn't have "Buyer's Agents" and "Seller's Agents"and "New Home Specialist" and "Accredited Luxury Home Specialist" - we had real estate agents that used an antiquated MLS search system (THE MLS book!!) to research Austin properties, that would at some point call their client to let them know if they had found 10-20 homes to go see (in person), and then the RE agent would go pick them (and their 6 kids!) up in their car, and spend the next 2 weeks (or 6 months!) physically driving ALL over town looking at homes!

Today, most of that homework that we, as Realtors, used to do, is now being done by the consumer BEFORE any RE agent is even called. So where do we NOW fit into the game, and why? As I've pointed out many times, times have changed the way we do business -AND- what the consumer now NEEDS and EXPECTS from a Realtor, i.e., Specialist.

The first thing is: ACCESS TO THE KNOWLEDGE BASE- Specialists by definition possess specialized information about their field that will benefit their clients. The real estate specialist who can demonstrate an ability to provide in-depth information about the market, neighborhoods, appreciation rates, clubs, social networks, affluent service providers, schools and more will have a distinct advantage over their competitors. As more information becomes available it is the specialist's job to stay abreast of the timeliest data available to protect and enhance their client's interests. Consumers cannot get this kind of info off the Internet!

Second:EXPERIENCE AND REPUTATION - Question: if you had a brain tumor, needed brain surgery, and could pick your surgeon, would you choose one with 3 years experience or 25 years experience? If given the choice, I know which one I would pick! I would pick the one that had the most extensive knowledge, experience, and hundreds and hundreds of hours in the operating room - one that had seen what had gone wrong in a procedure and known how to fix it, or known what could go wrong and circumvented the problem even before it became one. The same applies when it comes to choosing a REALTOR - the one with the most experience, the one that has sold hundreds and hundreds of homes generally has a much better idea of the problems and/or potential problems, and the ways to "surgically" remove them if that problem occurs - a Specialist in that medical field.

Third: SPECIALISTS PROVIDE VALUE ADDED SERVICES - Find the right church; find the right baseball/soccer/swimming/basketball league; know the distance to the nearest hospital/doctor/grocery store/post office;introduce them to their kids' new school principal/teacher/coach. Get the idea??!! We, as Realtors, didn't USED to have to do this because we DIDN'T HAVE TO!! We found the home (that was hard enough!), and too many times we thought we had earned the commission! Consumers didn't necessarily believe it then, and they sure don't BELIEVE IT NOW!

Fourth: GIVE THEM GOOD REFERRALS - Of course, we're not going to give them our BAD ones! DUH!! Perhaps the most powerful reason for a consumer to choose a specialist is a personal referral. The number one way that both traditional buyers and sellers come into contact with their agent is through the use of a personal referral - 40% of buyers and 44% of sellers. This statistic is even more pronounced among luxury home clients as 75% of current luxury home specialists report that their number one method for coming into contact with affluent clients for the first time is through a referral or recommendation.

A few years ago I coached a 10 year-old select baseball team I named THE EDGE. I chose that name because every kid on that team I had personally scouted, and I had decided that that particular kid had an "edge" over any other kid at a specific position, and was slightly better than the next player. I "cherry-picked" the BEST twelve kids I could find that had an "edge" - the BEST possible players to win with, and they did. In 2003, they won the Texas State Championship in their age division.

Today, in light of the current market conditions, both buyers and sellers are looking for an "edge". As they do in other areas of their life, they are looking for that edge in the right real estate specialist. It's evident all across the spectrum from buyers' agent to the sellers' agent to the luxury home specialist. They want the agent that has the specialized knowledge, the experience and reputation, the specialized services and they want proof of the fact.

Austin New Home Builders - Sex Appeal Sells

Phil Hutson (Austin TX Real Estate) — Fri, 05 Sep 2008 12:43:58 -0500

My high school football coach used to have a favorite saying, "When the going gets tough, the tough get going!" I always thought that sounded pretty cool (at least it did in '67!), so I've used that on my four boys over the years coaching them in various sports, and they always say, "Dad, that's sooooooo old fashioned!!" Well, I had a Division President for an Austin New Home Builder that I won't mention by name say that to me when I asked him how his company sales were so far this year, and I said,"______, that's a football cliche, what do you REALLY mean?" He told me that sales had been relatively flat, even with the many concessions/incentives they had been offering, until one of his marketing gurus came up with a different idea - sex appeal. He said he was going to "take the tough approach" to make it happen. It seems "tough times" is bringing out the "football mentalty" in some of these Builders - nothing old fashioned about that!

Now before anyone gets the WRONG idea, let me explain HIS version of "sex appeal!" It's absolutely nothing new, but in a down market it is the opposite approach that most Builders here have taken - instead of cutting prices, they cut a little square footage, and added "sex" appeal - in the form of granite countertops, outdoor patios w/BBQ grills, outdoor fireplaces, recessed lighting (on the OUTSIDE of the house!), soaker tubs, larger open master showers, etc. One Builder I talked to said he "couldn't build 'em fast enough!" The Builders that are reforming the Austin downtown landscape with the new lofts and condos took this approach about last year, and it seemed to work for them - of course, they had no choice - downtown lots are mega-bucks per sq. foot!!

But the underlying principle is the same - when faced with higher costs, the Builders had to come up with a different approach to make the bottom line work, and this seems to be working. There are still plenty of buyers looking for "the big box for little money", but for those tired of "plain vanilla" homes, this "sexy" idea is a breath of fresh air! Overall, Austin home sales, although lagging behind last year, are also a "breath of fresh air" to the local REALTORS!

Austin, Texas: Energy Audit BEFORE You Sell Your Home??

Phil Hutson (Austin TX Real Estate) — Wed, 27 Aug 2008 15:17:40 -0500

Commissioned by the Austin City Council, and with the blessing of Mayor Will Winn, Austin's Energy Efficiency Upgrades Task Force is finishing discussions for the basis of a possible ordinance with the ability to adversely affect the city's real estate market, and increase housing prices. The ordinance concerns energy audits to ALL homes, apartments, and commercial businesses. Initially, the audits would be voluntary with a "target percentage" of homeowner participation. If this "target" percentage was not met, the audit would become mandatory. Simply stated:

"For single-family properties, owners would be required to have energy audits before selling their home. These would probably be conducted by a third-party contractor, who would disclose efficiency information to prospective home buyers. How much the audits will cost is not known, but estimates have run between $150 and $350. In theory, the audit would take place at the time of the state-required home inspection. It will likely include both a visual and an air conditioning's duct system test."

Energy upgrade - For single-family homes

The city of Austin's Energy Efficiency Upgrades Task Force has written draft recommendations that could become a city ordinance, which would affect the local real estate market. The final recommendation is expected by the end of the summer before going to board and commissions and then city council this fall.
Mandatory
- What: A home seller must get an energy audit and disclose the results to buyers.
- When: Before the home is sold.
- Cost: Estimates range between $150-$350.
Voluntary
- What: Following an energy audit and disclosure, home sellers or home buyers can participate in the Energy Savings program by installing energy efficiency upgrades recommended in the audit. Austin Energy is expected to continue its existing energy efficiency financial incentives, including cash rebates or low-interest loans.
- When: To count in the Energy Savings program, upgrades must be completed before or within one year of the home being sold. The completion will be valid for as long as the current owner owns the home or 10 years, whichever is a longer period.
- Cost: Homeowners would make upgrades that pay for themselves in five years in energy savings or cost no more than 1 percent of the home's sale value. For a home valued at $190,000, that would be $1,900.
Possibly mandatory
- What: If targets to get homeowners to participate in the Energy Savings program are not met, the voluntary element would become mandatory. Following an energy audit and disclosure, home buyers would be required to participate in the Energy Savings program by installing energy efficiency upgrades recommended in the audit. Some homes would be exempt.
- When: Upgrades must be completed before or within one year of the home being sold. The completion will be valid for as long as the current owner owns the home or 10 years, whichever is a longer period.
- Cost: Homeowners would make upgrades that pay for themselves in five years in energy savings or cost no more than 1 percent of the home's sale value. For a home valued at $190,000, that would be $1,900

This ordinance would also affect the multi-family and commercial properties, impacting them even more than residential properties! And what's this mostly about? At the beginning of the year, the task force started meeting to develop the next steps in the Austin Climate Protection Plan, which promotes the policy of making the city a leader in reducing global warming.

First, it was the economic downturn, then $4/gallon gas, then higher property taxes, then the mortgage crisis, and now the local government wants to add global warming and an energy audit to help home sales in Austin????????

Again I'm reminded why I will never go into politics................