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Bill Morris
RE/MAX Capital City
13018 Research Blvd
Austin, TX 78750

Direct or Text: 512-785-3345
Email:              bmorris@remax.net

Texas Broker License # 505218

We take pride in our homes.  For most of us, our home is our largest physical and financial asset.  It's where we spend time with friends and family, where we may go for peace and quiet, and where we spend a lot of our hard-earned money.  It is much more than shelter, more than a residence.  It is "our place," with all the physical, mental, and emotional ties that implies.

Investment real estate shouldn't carry the emotional attachments of a home, but it can be a critical source of income and financial growth.  Financial assets -- stocks, bonds, etc. -- are an important foundation for many investors.  Real estate can provide more stability, current income, and predictable long-term growth.

I represent both buyers and sellers of residential and investment real estate throughout the Austin metropolitan area, which means first-hand market knowledge is brought to bear on serving your needs:

  • My relationship with a home seller begins with a thorough understanding of the client's objectives, needs, and timing. My ongoing analysis of properties and market areas throughout Central Texas provides the basis for a comprehensive analysis of each client's home.  Price consultation, property preparation and staging, and broad promotion of each property follow, and frequent communication -- showing feedback, market updates, and ongoing advice and counsel -- round out a successful listing engagement.  As a starting point, just ask me for a FREE Market Analysis. That may answer your immediate questions, or it could become the basis of a more comprehensive discussion.  That choice is yours.
  • My approach to buyer representation is also full service – shopping, previewing, price and market consultation, contracting, negotiating, coordination of inspections, appraisals, repairs, and closing details, and follow-up beyond the closing of your purchase to ensure your lasting satisfaction.  Looking for a new home?  Use Quick Search or Map Search to browse an up-to-date database of all available properties in the area, or use my Dream Home Finder form and I'll conduct a personalized search for you.

In both roles, honest advice and clear communication are what my clients expect.  The fact that more than 90% of my business is with repeat clients and their referred friends and family is a sign of success in meeting those expectations.  Client ratings that earned my selection for 6 consecutive years as a Five Star Professional -- representing less than 7% of Central Texas agents -- are also very gratifying, and humbling.

As you consider selling or buying Central Texas real estate, you'll find a lot of information on this website that can help.  Much of it is updated regularly, so come back often:

  • National and regional Market Trends is a thorough monthly e-newsletter you'll enjoy.
  • Average Mortgage Rates are up-to-date weekly.
  • As often as time allows, I update My Thoughts ...  on topics that I find important and interesting.
  • You'll also find regular market news on my Facebook and Twitter pages.

You'll find a details About Me and my approach to the practice of the real estate profession, and about why I am proud to be affiliated with RE/MAX and RE/MAX Capital City.

My business and personal experience tell me that service is the key to success and I look forward to serving you.

 

My Thoughts on Central Texas Real Estate

Affordability and Austin-area schools

I have commented previously on housing affordability issues in the Austin area.  Not only do rising home prices in the city of Austin cause urban sprawl and exacerbate transportation/mobility issues throughout the region, but they are also contributing to an ongoing loss of students in Austin ISD:

Austin school district enrollment tumbles by 1,600 students, as adjacent districts grow

Readers who follow me here know that this kind of story makes me wonder about more specifics, and this one does just that.  As a key point of reference, note that according to MLS data, the median price of a single-family home in the five-county Austin Metropolitan Area at this point in 2018 is $315,000.  There are ten school districts with median home prices below that level:

In-demand Leander ISD is a little higher than the Metro median, but Austin ISD is $84,000 — 26% — higher at $399,000!

ACS data shows metro area median household income at $73,800 in 2017.  For discussion’s sake, assume it has increased to $75,000 in 2018.  With 10% down and reasonable assumptions about taxes and insurance premiums, the monthly payment at a price of $315,000 would be about $2,445, or about 39% of a median household’s monthly gross income.  Generally, the median-priced home in the ten lowest-priced school districts should be affordable for a median-income household with little or no other debt.  In Austin ISD, however, the median-priced home requires just under $100,000 annual income.  Note that the definition of “median” is that 50% of all houses in Austin ISD require more than $100,000 household income.

As you might expect, migration toward the suburbs is putting pressure on home prices there as well.  Look at the rate of price change over the past five years:

There’s not a perfect correlation, but the lowest-priced school districts are generally experiencing the most dramatic increase in home prices, from just under 40% in Round Rock, Lago Vista, and Leander to almost 85% in Del Valle ISD!

Ultimately, where we can afford to live is a function of housing and transportation/commuting costs.  As Austinites move farther from the city, their commuting costs generally increase.  The combined cost of housing and transportation will ultimately impose a real limit on how much sprawl we can sustain.  In the meantime, hollowing out Austin ISD is impacting the region’s largest school district in very detrimental ways.

The city of Austin has talked for years about land use policies aimed at creating activity centers around the city where at least some residents can live, work, and play, and which will concentrate enough of our growing population to make a functional transit system at least possible.  In addition, Austin voters recently approved $250,000 in bond debt that will be used to address the city’s affordability issues more directly.  The issue is a regional one, however.  Central Texas remains an attractive place to live and to visit.  Let’s do everything we can to keep it that way.

Market Dashboard Update, 3Q 2018

I offered some thoughts yesterday about where we are in the current market cycle.  For a broader view of the Austin-Central Texas residential real estate market, this post will cover my ongoing Market Dashboard, now updated through 3rd Quarter 2018.

First, Trends to Watch commented on listing inventory.  Here’s the big picture since near the end of the last market cycle:

Most market analysts consider 6 to 6 1/2 months’ supply to represent “normal” or “balanced” market conditions.  Notice how long our local market inventory has been at or below half of that level.  Listing inventory in September was 3.0 months, unchanged from August and the same as September 2017.  Seasonal performance looks very much like each year since 2014.

My earlier post also discussed market absorption — i.e., the “odds of selling” for an active listing each month.  For historical perspective, this chart clearly shows how different this market cycle has been from all others in almost 30 years:

The steep decline from 46% to 31% between May and September is noticeable.  As I said earlier, though, one data point is not a trend.  This metric will bear watching in the coming months.

Finally, I wrote previously about the slowing pace of year-over-year price appreciation, but the view of actual average and median prices is important:

Notice that very strong demand has pulled prices upward and above the long-term trendline in recent years, most noticeably since 2015.  Prices have moved closer to the trendline since June, which hasn’t been unusual in recent years, but it is more noticeable and coincides with the decline with the decline in “odds of selling.”  Again, there isn’t enough data here to state with certainty whether this is the beginning of a market transition or just typical seasonality.

Market economists remain confident in our strong market conditions through 2019 and into 2020, and I agree.  Inevitably, however, we will see prices moderate, interest rates increase, “days on market” grow, and inventory will begin to catch up with demand.  I don’t see signs right now of a sharp change but instead anticipate a fairly smooth transition.  Of course, external factors that we don’t know about today could change that, but that’s another post for another time, if needed.

Related news …

Just after I posted Trends to Watch, commenting on changes in the Central Texas real estate market, I found a very good article from Inman in my inbox that covers the national outlook:

Inventory is rising, home prices could flatten in 2019
But don’t expect homes to get cheaper anytime soon with demand remaining high

Strong demand in the Austin area is preventing real inventory build-up, but prices flattening here in the coming year or two may well be a fact.  Our Months’ Supply metric was 3.0 months in September 2018, the same as September 2017 and only slightly higher than 2.8 months in September 2016.  Moreover, all other monthly inventories were consistently lower in 2018 versus the same month in 2017.

There was also a related article in this morning’s Austin American-Statesman:

Austin-area Homebuilding pace slows in third quarter

Home prices in the city of Austin’s are pushing buyers farther and farther into the suburbs, and availability of build-able residential lots and permitting processes in some areas have slowed building starts.

The issues highlighted in both of these articles will remain important in the months to come, and I’ll keep an eye on them.

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