Austin-area home starts jump in first quarter of 2016

The Kyle and Buda submarket is among the top submarkets in terms of home startsu2014concrete being poured for new homesu2014as of the first quarter of 2016, Metrostudy reported April 19. This Stonefield home is located in the Buda area.

The Kyle and Buda submarket is among the top submarkets in terms of home startsu2014concrete being poured for new homesu2014as of the first quarter of 2016, Metrostudy reported April 19. This Stonefield home is located in the Buda area.

Homebuilders in the Austin metro area started 40 percent more homes in the first quarter of 2016 compared with the same period in 2015, according to an April 19 report from real estate data firm Metrostudy.

At the beginning of the year, an active buyer market led builders to ramp up their home starts, which is when a builder pours the foundation for a new home, said Steve Plevak, regional director of Metrostudy’s Austin office. But most of that growth has not been in the Austin city limits, he said.

“With everything going on with price points, the fees associated with Austin [and] the building code requirements, most [of the housing supply] below $400,000 is really going to be pushed into peripheral communities—it’s not going to be in Austin,” he said.

The company’s Austin metro statistical area includes the Travis, Hays, Williamson, Comal and Bastrop counties, Plevak said. The top five submarkets are Kyle and Buda, Pflugerville, east Cedar Park/Leander, west Cedar Park/Leander, and Southern Travis County, Plevak said, noting about 43 percent of all home start activity is happening in those submarkets.

As a result of weather, most starts in 2015 were squeezed into the third quarter, which led to a retraction in the fourth quarter, he said. Builders have reported strong overall sales at the end of 2015 and the first three months of 2016, he said.

Though the Austin economy as of March 2016 had experienced 4.1 percent job growth year over year, wage growth has failed to keep up with rising housing costs, according to Metrostudy. Builders also responded to demand for more affordable housing, as a significant jump was seen in starts in the price ranges between $200,000 and $300,000. Plevak noted those price points remain constrained in terms of lot supply, and if builders and developers want to continue that trend they must expand the lot supply.

In the $200,000-$250,000 price range, the top five submarkets are Kyle and Buda, Hutto, Pflugerville, west Cedar Park/Leander, and Manor, Plevak said.

“We don’t really see a lot of growth in the Austin markets … but it’s really because we can’t serve that $200,000-$300,000 [homebuyer] appropriately, and so as a result everything in that price range moves really quickly,” Plevak said.
By Kelli Weldon
Kelli joined Community Impact Newspaper as a reporter and has been covering Southwest Austin news since July 2012. She was promoted to editor of the Southwest Austin edition in April 2015. In addition to covering local businesses, neighborhood development, events, transportation and education, she is also the beat reporter covering the Travis County Commissioners Court.


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