Thanks again to David Tandy, CEO of Texas National Title for a great Economic Update highlighting the conditions, statistics, and projections of our Austin Real Estate Market. This is a follow up from a previous conversation I had with him last month that you can read about here: Are We Set For a Market Crash?
Population and Job Growth for Austin
- The US Population has been on a decline since the 2007 recession with fewer births over deaths.
- TEXAS is #1 in the nation for population growth
- AUSTIN is currently in growth mode with an uptick in population since 2018.
Where have all the workers gone?
If Austin's population is on the rise, where are all of the workers? People don't want to work due to COVID and Unemployment Payments.
- 22 million US jobs lost during COVID shut downs
- 17 million jobs since created
- We need 6 million jobs to get back to pre pandemic
- As of July 2021, there were 10 million US Job Postings
- 8 million unemployed people
AUSTIN has the Top 3 healthiest job markets in the US.
- 4.4% Unemployment rate (5& is considered full employment) \. Everyone wh wants a job has one.
- Austin has 90,000 job openings
- 55,000 unemployment people
Which Employers are Expanding or Relocating to Austin?
Home Inventory Shortage
Why are there so few Resale Listings?
- People have been reluctant to list because of COVID
- Where would they go???
- People are staying in their homes longer
- Impact of increasing Labor and Material Costs
Why is Inventory so Low?
In the early 2000's, the US was building more homes than the population increase. This was scaled back during the recession and we were not building enough homes. This is not getting adjusted, but in Austin that variance is greater and we have had a 15 year shortfall. We are only now, this year, starting to build enough homes. 
Inflation
What is causing the jump in Inflation?
Core inflation has jumped to 4.5% where 2% is the goal. (Core Inflation does not include food or gas which is typically volatile). The Core Inflation jump has been caused by shortages of supply and supply chain issues which is temporary and should correct itself. If the Fed decides inflation is a big deal, we will start to see mortgage rate rise.
Home Price Trends
We are not expecting to see home prices drop. This is not a bubble that will burst because we don't have loans being made that people can't afford. Home prices should not exceed inflation so we should see a slow down. Austin is still considered affordable because personal income is high. However, that could change as income hasn't increased at the same rate as home prices.
