Why Investors Continue to Target the Austin Real Estate Market
As the nation’s second fastest growing city, Austin is a prime target for private real estate investment. Obvious reasons include Austin’s standing as a vibrant college town, the Texas state capital, Live Music Capital of the World and host of South by Southwest (SXSW). But some intriguing quirks make the Austin real estate market even more attractive.
For starters, Austin boasts an astonishingly high average of 300 sunny days a year. And it is legendary for its unofficial motto – “Keep Austin Weird” – which was coined in 2000 and proved so successful for economic development that Portland copied the slogan in 2003. Austin is also home to the Austin City Limits Music Festival and the Formula 1 Grand Prix, globally known festivals that make Austin an exciting place to live. Abundant green space also makes Austin popular for biking, swimming and other recreational activities.
Austin topped U.S. News & World Report’s rating of best places to live in both 2017 and 2018. The magazine calculates that about 50 people move there every day. The city ranked second in growth from 2010-2015, according to the latest U.S. Census Bureau stats. So Austin investment properties are poised for strong appreciation.
Austin Real Estate Market Benefits From Education & Tech
The highly ranked University of Texas is the most significant influencer among Austin’s assets, and a huge boon to the city’s investment property. U.S. News & World Report rates UT-Austin a global university on par with the University of Wisconsin, Washington University in St. Louis and North Carolina. The university makes Austin one of the nation’s highest-growth areas for young adults.
Its role in tech research has also been a significant growth driver to Austin and made it a tech hiring hotspot. Austin’s big industries include semiconductors, space technology and life sciences, and the city attracts corporations such as Apple, Dell, IBM and Samsung, who hire college grads. Metro Austin ranks among the nation’s top areas for STEM occupations – jobs that require science, technology, engineering or math knowledge. The U.S. Bureau of Labor Statistics estimates there are 13,680 Austin jobs for application software developers alone.
Job Growth Spurs Growth in Austin’s Real Estate Market
Austin’s job growth rate, 3.7% for the 12 months ending in February 2018, is the second-highest in the U.S. Oracle’s new corporate campus southeast of downtown shows what makes real estate investment in Austin so vibrant. The tech company’s property overlooks a lake that runs right through the middle of the city – it used to be called Town Lake, but now it’s called Lady Bird Lake. Oracle is locating 3,000 workers in the idyllic spot, and another development phase is expected to add 2,000 more.
Thanks to such robust growth on both fronts – jobs and population – Austin’s downtown skyline is studded with cranes and construction dust. 20 high-rises are changing the city’s skyline, including The Independent, the city’s tallest high-rise and a game-changer for its size and architectural significance.In all, about
Austin’s Workers Spur Suburban-Style Growth
While downtown Austin is booming, it’s also becoming more unaffordable, so people are moving to Austin’s outlying areas. Origin, noticing this trend, is currently putting modern amenities into Ellie Apartments, formerly Mission Hills, a 344-unit apartment complex in Southeast Austin, about four miles from the city’s thriving downtown. Its access to Interstate 35 and Texas Highway 71 already make this a strong market, but corporate real estate investment will speed its growth.
Another hotspot is Domain, a bustling office, retail and residential center on the north end of Austin. It’s been dubbed Austin’s second downtown. When it was originally built, it was in the middle of nowhere. And now you have Facebook and Amazon there, new office and multifamily real estate, plus great restaurants and high-end retail.
Thanks to this development pattern, the Austin real estate market will become more like a mini-Los Angeles, with high-density but compact nodes popping up everywhere. And Austin investment properties in these nodes are going to outperform real estate investments that are not adjacent to these suburban-style urban developments, or don’t have their easy access to transportation.