Austin real estate agents know that despite all the bad news from around the country, Austin's real estate market continues to at least hold its ground. The latest news, however, is a little less than inspiring, taken all-in-all.
The good news first: the Central Texas job market has not yet begun to collapse like many others across the country. In fact, we even saw a gain of 2.9 percent in March, swelling the total Austin area workforce to three-quarters of a million. And the specter of unemployment only recently raised its head, up just one-tenth of one percent from this time last year.
Unfortunately, Austin-employment stalwarts will be darkening the picture a little. Dell is preparing to close its manufacturing plant-hitting 900 workers. AMD just let 215 workers go, and Whole Foods will be shutting down its bakery in June, throwing 52 out of work.
Still, that leaves Austin's unemployment rate significantly lower than the national average of 4.3 percent.
So much for the good news. The bad is not, unfortunately, in short supply, starting with foreclosures. They're up, which, unless you're in the market for a foreclosed home, is bad. There was a big auction of said homes on the sixth of this month, and according to Foreclosure Listing Service, they are up a stunning 32 percent over this time last year.
May is the fourth consecutive month that Travis foreclosure postings have topped 300, said George Roddy Sr., president and chief executive of Foreclosure Listing Service.
"The last time monthly foreclosure postings in Travis County increased in four or more consecutive months was four years ago in the early part of 2004," he said
Other parts of the state are suffering, too, with increases of 40 percent in Dallas-Fort Worth and 126 percent in Comal county, home of New Braunfels.
Figures on home sales are similarly discouraging, with the key number being "twenty-one - the percentage decrease in Central Texas home sales compared to this time last year. And it's been nine consecutive months that the figure has dropped-not just a passing trend. Pending sales are even worse-down 54 percent, "the highest percentage on record."
Median prices are still up, but that may just be an artifact of other bad news-as the credit crunch tightens, fewer and fewer homes are being sold to entry-level buyers. So, the more inexpensive homes are suffering more slowdown than the market as a whole. If the slowdown had applied evenly across all sectors of the market-from the cheapest to the most expensive-the median price might actually have fallen.
I think what we're finally seeing is the national slowdown affecting Austin," with the effects hitting most aggressively in the past 90 days, said Mark Sprague, Austin partner for Residential Strategies Inc., which tracks the housing market.
"The consumer confidence index has dropped to its lowest level since 1983," Sprague said. "Everybody is scared to death to make a decision to sell their home."
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