With a diverse set of housing and mixed-use properties in development or built out, including homes that sell for $1 million or more, one Southwest Austin ZIP code is evidence of Austin’s increasingly expensive real estate market.

The 78735 ZIP code had a large spike in its median home sale price in December, jumping 113 percent year-over-year to almost $1 million.

According to data from the Austin Board of Realtors, $940,000 was the median price of homes sold in the 78735 ZIP code in December. During the same time in 2014, the median price was $441,450.

In December, 11 properties in 78735 sold for more than $1 million, including one for $3.1 million, said Stan Martin, ABoR Multiple Listing Service supervisor, via email. 

If the $3.1 million home had not been sold, the median price would have been $736,000, or a 67 percent increase year-over-year, he added.

In any given month during 2013 and 2014, there were only a few properties sold per month between $1 million and $2 million in 78735, Martin said.

In January the median price decreased 20 percent year-over-year.

Realtor and Southwest Austinite Aaron Farmer said there has been an upward trend in median home prices over the years in 78735, but a dramatic shift in data trends has not happened yet and the large jump in December is an “anomaly.” If large increases occur for 12 consecutive months, then it could be considered a trend, he said.

Living, working in 78735

Farmer, who is also the ABoR board of directors president, said median price data can be skewed if the ZIP code is as economically diverse as 78735 is.

Within a mile of each other are three neighborhoods: Barton Creek, Travis Country and the Old Bee Caves Road area, Farmer said. Barton Creek has high-end homes for $1 million or more; Travis Country has median-priced homes from $400,000 to $600,000-$700,000; and the Old Bee Caves Road area has trailer homes.

“And so you have probably some of the lowest-priced homes in Austin … and to the north is Barton Creek, with some of the most expensive homes in Austin,” Farmer said.

As an example of skewing, Farmer cited the $638,000 median home sale price in October 2014 as the highest in that year. The following month, the median price decreased to $432,500.

To give a more accurate representation of a neighborhood, Farmer said he provides other information to potential homebuyers when they search for a home by ZIP code, including nearby schools and amenities.

Jim McNabb, a Travis Country resident for 17 years, said he moved into the subdivision because it is a “wonderful little island” already built out and surrounded by green space.

“The thing is, there aren’t a whole lot of houses for sale here,” McNabb said. “Nobody, really, is leaving.”

McNabb added that when a home does go on sale in Travis Country, it is sold within days.

Since 1993, The Natural Gardener on Old Bee Caves Road has specialized in organic plants and outdoor wares. Its owner, John Dromgoole, said nurseries throughout the country tend to open on the edge of towns, and cities usually grow around them.

As time passes, the land that the nursery is built on may become more valuable, Dromgoole said, though he ruled out that he is retiring or selling The Natural Gardener land soon.

Another benefit to the growth of 78735 and Southwest Austin is the emergence of more affluent customers who spend money on outdoor furniture and sculptures, Dromgoole said.

“The environment has changed dramatically, [and] the traffic is a horrible mess,” Dromgoole said. “But when it comes down to the price of property around here, I don’t know if that’s a benefit or not.”

Driving the growth in the 78735 area is its close proximity to downtown and the development of retail and restaurant centers such as The Shops at Arbor Trails, Farmer said.

“When I first moved into Southwest Austin in 1999, the area wasn’t as popular and there weren’t that many shops and restaurants,” Farmer said.

Expanding 78735

Stratus Properties, involved with the development of Barton Creek, Circle C Ranch and other Austin properties, is at work on Tecoma, a large mixed-use development in 78735 north of Southwest Parkway with 1,850 multifamily residential units and 1.5 million square feet of commercial space.

Stratus Properties CEO Beau Armstrong said the company also completed a water utility project in the Barton Creek subdivision in 2015, opening the area for development.

Since then, Stratus Properties opened the first buildings of The Santal apartments in January. The 236-unit project, part of the overall Tecoma project, may be completed by June, Armstrong said.

The internal planning phase for Tecoma includes features such as multifamily housing, office space, retail, restaurants and nightlife destinations, Armstrong said.

At the southwest corner of Southwest Parkway and William Cannon Drive, Stratus Properties is planning a separate, 325,000-square-foot mixed-use development with office and retail, Armstrong said. Multifamily residential space for the project is being considered, he added.

“In a nutshell, there’s so much going on out there right now,” Armstrong said. “We’ve owned that property for probably 25 years now and it’s been on a path of growth, but it is square in the bullseye of where people want to be.”