Congratulations! You’ve decided to look for a home — either your first one, or a move-up. You’ve got good employment history, solid rental and/or mortgage payment history, you have managed your credit, and you have been preapproved to spend $250,000 for your house.
Can you move to West Lake, or Tarrytown, or Hyde Park? Probably not.
You watch the news or read the paper and saw that the “median” home in the Austin area last month (November 2014) was $249,900. Great! You’re in! But even with our notoriously low supply of homes for sale, there more than 7,000 single family homes on the market today in our 5-county metropolitan area. Where should you look?
A few preliminaries: What part of town do you like? Where do you work? Do you care about a specific school district or specific schools? Want to be close to certain recreational or entertainment activities? What’s your attitude about commuting, and what times will you be going to work and coming home? Do you like newer homes, or older ones? Larger or smaller? Mind climbing stairs, or like to? Need a home office or a workshop or a studio? Want a small lot or acreage where you can keep a few animals? Is a walkable neighborhood important to you? Do you prefer public transportation, or need the freedom of having your own car or motorcycle or bicycle during the day?
You understand that each of those questions could open many more, and introduce trade-offs that you may not have considered. There are no universal solutions, and I won’t pretend to start that consultation here. Armed with your answers, however, and knowing your budget, you can begin to narrow your search. Here’s a look are sales of single family homes so far in the 4th quarter of 2014:
Those cities are sorted according the their median sale prices, but note that some span more than one county. Keep in mind that the definition of “median” is that half of all sales were for prices below the median price shown, so the figure in the right-hand column of that table isn’t your ceiling. You may well find your $250,000 dream home in North Austin, or Georgetown, or Dripping Springs. You may even find it in “Austin-proper,” i.e., in Travis County. It may be older than you wanted in mind, or may need a little work, but if being close the what the central city has to offer is important to you, that’s one of those trade-offs that may make sense.
Also pay attention to how statistics can be deceptive. For example, there were a total of two sales in Volente over this 3-month period, so the average price and the median price were $1.2 million. But that doesn’t tell you that there are three active listings today between $450,000 and $540,000 — not your target price, but less than half of the median price for the area. Likewise, there were only two sales in Maxwell — one at $500,000 and the other at $1,075,000. Based on that you might avoid the area, even though all of the active listings there today are at $220,000 or less.
The same kind of happy surprise becomes much less likely the closer you get to central Austin. In Tarrytown, for instance, seven houses sold during the October to December 21 period considered here, with prices ranging from $640,000 to $1.3 million, but of the six active listings today the lowest list price is $899,000. In some areas with more moderate median or average sales prices, you’ll find that property-specific features such as views or water frontage, or being flood-prone or adjacent to railroad tracks, can create wide price variations in the same general part of town.
If you know the Austin area, you’ll know that some neighborhoods are completely beyond your buying power and that others are simply not desirable to you, but I hope this look at several dozen towns and cities in our metro area will help you find a starting point. Whether you know the area or not, your real estate professional should help you through the trade-offs involved in your very important decision. If you’re not represented already, let’s talk about your plans. I’ll be happy offer my best professional advice and counsel.