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October 28th, 2010 11:02 AM

By Beverly Kerr, Chamber Vice President of Research

For the fifth month in a row, Austin takes first place in a ranking of the 50 largest metros based on the percent increase in payroll jobs over the preceding 12 months.

Friday’s release of September 2010 payroll jobs numbers by the Texas Workforce Commission and U.S. Bureau of Labor Statistics saw Austin sustain growth over 2% year-over-year seen in the previous two releases of this data. Austin has added 17,300 jobs, or 2.3%, over the last 12 months. Job growth is now positive in 22 of the 50 largest metros.

In Austin, four industries lost jobs and seven industries added jobs in the last 12 months (and one industry remained unchanged). The industries that see positive growth are manufacturing, financial activities, professional/business services, education/health services, leisure/hospitality, other services, and government. The most robust gainer in both numbers and rate of growth was leisure/hospitality with 10,100 new jobs, or 12.2%. Three other private industries (professional/business services, education/health services, and other services) also enjoyed above average growth.

Most months in this recession, we’ve attributed the highest job losses and rates of loss to manufacturing and construction/natural resources, but that is not the case in September. The two goods-producing industries combined lost only 400 jobs (-0.5%) in the last 12 months (a small 200-job gain one helping to offset 600 jobs lost in the other. Of the three service-providing industries with negative growth, retail lost the greatest number, 1,900 jobs (-2.3%) and information lost at the greatest rate, -3.1% (600 jobs). Private service-providing industries, with both gainers and losers, have seen a net gain of 14,700 jobs (2.9%) over the last 12 months, while government has seen a gain of 3,000 jobs (1.8%).

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Posted by Jackie Mills on October 28th, 2010 11:02 AMLeave a Comment

October 6th, 2010 4:13 PM

Last week brought the release of 2009 estimates (before the release of the actual Decennial Census) from the U.S. Census Bureau’s American Community Survey (ACS). Here’s a sampling of findings from the 2009 ACS for the 5-county Austin Metropolitan Statistical Area. More information is available from the Chamber of Commerce.


Austin is ranked fourth in the nation for the percent of the population aged 25 and over with a bachelor’s degree or higher. Out of 1,096,413 residents over 25 years or older, Austin has 38.7% with at least a bachelor’s degree compared to 27.9% nationally, beating out Denver, Seattle and New York.

The population enrolled in college or graduate school is 148,329 or 31.2%, compared to 27.9% nationally.


Austin has the highest in-migration of population out of the 50 largest metropolitan areas with 6.9% of the population have moved from a different metro or non-metro area in the last year.

The Austin MSA Population is estimated at 1,705,075 and households at 614,047.

The population over 65 is estimated at 134,124 or 7.9%, compared to 12.9% nationally.

The Hispanic population is 30.7% compared to 15.8% nationally.

Foreign-born total 249,240, or 14.6%, compared to 12.5% nationally. A larger portion of these are not naturalized (71.3%) compared to the nation (56.3%)

Median age is 32.4 years, compared to 36.8 years nationally.


Median earnings for a male full-time, year-round worker is $44,881, 1.3% below the national earnings. Median earnings for a female full-time, year-round worker is $38,025, 7.0% above the national earnings.

Median household income is $56,218 compared to $50,221 nationally.

Management and professional occupations account for 42.1% of jobs held by the civilian employed population, compared to 35.7% nationally.

Real Estate.

The median value of an owner-occupied home is $189,300 compared to $185,200 nationally. Renters pay a median rent of $909, compared to $842 nationally.

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Posted by Jackie Mills on October 6th, 2010 4:13 PMLeave a Comment

Sign Number 1 – Texas Leading Indicators: The Federal Reserve of Dallas publishes a number of reports analyzing the employment and economic activity of both the state and major metropolitan areas. The recent Texas Economic Indicators has several positive signs of recovery for Texas and Austin.

The Metro Business Cycle Index, which tracks movements in employment, unemployment, wages and retail sales, shows that Austin’s economy moved into recovery in February. The index for Austin has sustained growth at an increasing rate each month, while the Texas Business Cycle Index has stayed at roughly the same rate of growth for the last four months. Texas and its major metros, except for San Antonio, have been indicating economic growth since January or February. Texas, Austin, and Houston have seen roughly 2% growth in the Index over the first seven months of 2010 while Dallas and Fort Worth have seen gains of about 1%. San Antonio continued to see negative growth for several months longer and July is its first instance of an increase in the Index since April 2008.

Source: Texas Economic Indicators – Federal Reserve of Dallas and the Austin Chamber of Commerce

Source: Texas Economic Indicators – Federal Reserve of Dallas and the Austin Chamber of Commerce

The Austin Chamber of Commerce provides additional analysis of the Texas Economic Indicators report.

Sign Number 2Apartment occupancy rate is increasing. Capital Market Research reports that twelve new communities brought units to the market in the last six months, adding a net total of 1,344 units since December. But absorption was a remarkable 4,849 units which pushed occupancy up 2.3% points to almost 93%. Because there are only 623 units scheduled for delivery in the last six months of 2010, CMR predicts the multi-family occupancy rate will increase another 2% to 95% by year end.

Multi-family development and construction is at a stand still. New developments will not begin until occupancy rates increase (which they are) which will force rents to increase (which is happening) which will spur new developments. Apartment builders should be lining up their projects now.

Source: Capital Market Research

Dr. Mark Dotzour, the Chief Economist for the Real Estate Center at Texas A&M, similarly predicts the Austin Apartment Occupancy rate will be 96% by the end of this year.

Sign Number 3Austin’s Job Growth is Strong: Dr. Dotzour also predicts U.S. economy would begin to produce jobs in the next 12 months and that Austin would outperform the nation in job growth. At the RECA 10th annual Mid-Year Economic Forecast, Dr. Dotzour noted the Austin's job growth is 2.3 percent today and forecast Austin job growth to be 3% in the next 12 months. He also forecast Austin population will grow 2% in the next 12 months.

Sign Number 4Corporate Profits are Increasing: Finally, as also noted by Dr. Dotzour, corporate profits are increasing. Companies need profits before they can start hiring.


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Posted by Jackie Mills on September 24th, 2010 10:06 AMLeave a Comment

August 18th, 2010 11:01 AM

It may be difficult to reach amicable decisions when it comes to neighborly disputes, where relationships can be stretched and boundaries pushed if issues are not handled carefully.

When you share a property line with another individual, there will come a time when you will be involved in joint decisions. Should your fence be replaced? Who is responsible for the cracking sidewalk? And can you cut down that overgrown vegetation obstructing your view?

Here are some of the most common causes of neighbor disputes, and how to handle them in a "neighborly" way.

1. Trees: In general terms, you are allowed to trim branches that overhang onto your property line, but no more. The actual tree owner is whoever's property contains the trunk of the tree. If you damage or destroy a tree that is not your own, you are liable for damages that may well exceed the value of the tree. If there is danger of a tree falling on a structure on your property, then you may have recourse through local and city ordinances.

2. Fences: An ugly fence is an eye-sore to be sure, but as a homeowner you have no recourse against ugly (unless your HOA has specific fencing specifications).

A fence that is in disrepair, however, is the responsibility of both you and your neighbor. According to legal experts at nolo.com, "Unless the property owners agree otherwise, fences on a boundary line belong to both owners when both are using the fence. Both owners are responsible for keeping the fence in good repair, and neither may remove it without the other's permission. A few states have harsh penalties for refusing to chip in for maintenance after a reasonable request from the other owner. Connecticut, for example, allows one neighbor to go ahead and repair, and then sue the other owner for double the cost."

3. Noise Disturbances: Nearly every town has a noise ordinance, which generally outlines the reasonable times and decibel levels at which a resident may make "noise." If you are having a recurrent issue with a neighbor, it may be best to allow local authorities to enforce their own ordinance.

When an issue arises, take it upon yourself to talk to your neighbor one on one. Approach the situation gingerly. Be conscious that for every viewpoint of your own, there are 10 other, and equally valid, points. Tolerance is acceptance of this fact.

Try not to broach a subject when you are angry or emotional. Matters of property are not ones to discuss while heated.

Listen carefully to your neighbors opinion on the issue. And then express yours as calmly and clearly as possible. Don't be afraid to be truthful. You are worried that a tree will fall, yes, but you also hate the way it blocks the sun from your porch.

Be willing to make a compromise, as well as to offer concessions to a neighbor.

If a calm and direct approach does not work, then you will need to hand off this issue to the appropriate authorities. Your first stop is your local Homeowners Association. If no HOA is over your jurisdiction, then local city officials may be able to help, depending on the issue.

Your final course of action is legal. This may, of course, break an already stressed relationship, so you must be prepared for a strained environment if you do so.

If a legal decision is rendered that is not in your favor, be sure to accept it and to move on. There is no need for harassment or childish behavior.

Good luck handling your "neighborly" dispute!

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Posted by Jackie Mills on August 18th, 2010 11:01 AMLeave a Comment

The real estate industry and especially the mortgage industry have been overwhelmed with changes, regulations and consolidations recently. In the last couple of months, many transactions nationally have experienced delayed closings or worse as a result of the application of new guidelines affecting APR, Good Faith Estimates (GFE), Truth in Lending (TILA) and condo project approvals to name a few.

There is one more issue that is critical for real estate agents, loan officers, and anyone else who deals with consumers purchasing a home or obtaining a refinance. Effective with applications on or after June 1, 2010, Fannie Mae has issued new lender mandates (FNMA LL-2010-03 Loan Quality Initiative) on a national basis that, if not understood properly, could have devastating consequences for many buyers and sellers. We want to be certain that everyone understands the implications of the new rules and ensure that all interested parties know what they need to know to minimize negative repercussions.

The intent of this initiative is to assure that all applicant information is disclosed and is honest and accurate as of the moment of closing. Lenders will now be required to re-pull credit report information just prior to closing, re-verify employment, validate Social Security numbers, verify intent to occupy and verify that all parties to the transaction have been checked against the national “excluded party” list, which is managed by HUD and by the General Services Administration. Changes in any of these factors are likely to result in a re-underwrite, the need for additional documentation, or suspension of loan closing.

The most onerous of these is the credit re-pull. It is important that this is done as a “soft pull” so it does not show as an inquiry, which could potentially change the borrower’s credit score. Firms will, however, have to match the outstanding debts and inquiries with the report used to approve the loan. Additional credit or increased balances that change the debt-to-income ratio more than 2% (or less if it now exceeds guidelines) will require the loan to be suspended and re-submitted to underwriting.

Any additional delinquencies will result in a new, full credit re-pull and re-underwriting, utilizing the new credit. Any and all inquiries from other lenders or credit suppliers must be verified by the credit bureau and certified that new debt did not occur. If new credit has been extended, the new debt must be included in the borrower’s debt-to-income ratio and the loan must be re-underwritten.

Other considerations are W-2 employees that may own more than 25% of a business, mandating business returns and cash flow analysis and full disclosure of child support and alimony. Changes could render the applicant unqualified or could delay the closing. As a result of TILA, GFE and risk-based pricing changes, additional debt could result in re-pricing the loan due to a change in credit score, which even if approvable, would delay the closing three business days as re-disclosure would be required.

So How Do We Manage the New Process?
Real estate agents and lenders must impress upon the applicants the need for full and honest disclosure at the time of application, during the loan process and at closing. Buyers must be cautioned against applying for new credit during the process, changing jobs (30-day pay stub requirements are being enforced), and charging to their credit cards. It is imperative that they notify the lender if anything changes from application to closing.

We must all be aware that an applicant that signs an erroneous initial or final closing application could be committing fraud. Lenders choosing to approve loans without the proper loan quality processes and documentation are only endangering the buyer. Any lender or real estate agent that encourages someone to falsify information could be equally responsible. It is noteworthy to mention that many loans go through an immediate quality control audit post closing, so this could affect highly qualified applicants as well. Identified fraud of this nature could be investigated by the FBI.

While this new policy was implemented first by Fannie Mae, it is already a mandate of all national lenders and, based on experience, will soon be required on every loan. It is important to keep this in mind on every deal, not just ones that may involve Fannie Mae.

Jim Dinkel is vice president of FM Lending in Raleigh, North Carolina.

Ken Trepeta is director of Real Estate Services for the National Association of REALTORS®.

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Posted by Jackie Mills on August 11th, 2010 4:27 PMLeave a Comment

The majority of the 20 cities included in the S&P Case-Shiller Home Price Indices are showing gains off the bottom in May. Three cities, San Diego, San Francisco and Minneapolis all reported year-over-year gains of more than 10 percent (but still remain 34.8 percent, 34.9 percent and 28.3 percent, respectively, below their market peaks). Only one city has a home price index less that January 2000, and that was Detroit.

The best long term performing city in the index (and only one from Texas) is Dallas (-5.2% decline from the Dallas Market Peak). Based on Median and Average Sales prices for both Dallas and Austin, Austin would most likely show a better performance than Dallas if it were included in the index.

The two worst markets in terms of price decline from the Market Peak are Las Vegas (56.4%) and Phoenix (51.2%).

The methodology of the Case-Shiller is based on re-sales of the same property (so it really is a superior measure to medians or average prices).

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Posted by Jackie Mills on August 5th, 2010 8:18 AMLeave a Comment

June 2010

The MetroMonitor is a quarterly, interactive barometer of the health of America’s 100 largest metropolitan economies. It examines trends in metropolitan-level employment, output, and housing conditions to look “beneath the hood” of national economic statistics to portray the diverse metropolitan trajectories of recession and recovery across the country. The aim of the MetroMonitor is to enhance understanding of the particular places and industries that drive national economic trends, and to promote public- and private-sector responses to the downturn that take into account metro areas’ unique starting points for eventual recovery.

1. Albany, N.Y.
2. Augusta, Ga.
Austin, Texas
4. Baton Rouge, La.
5. Buffalo, N.Y.
6. Columbia, S.C.
7. Dallas, Texas
8. Des Moines, Iowa
9. El Paso, Texas
10. Honolulu

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Posted by Jackie Mills on July 2nd, 2010 3:54 PMLeave a Comment

RISMEDIA, June 30, 2010—RealtyTrac, one of the leading online marketplaces for foreclosure properties released its first U.S. Foreclosure Sales Report, which shows that foreclosure homes accounted for 31% of all residential sales in the first quarter of 2010, and that the average sales price of properties that sold while in some stage of foreclosure was nearly 27% below the average sales price of properties not in the foreclosure process.

A total of 232,959 U.S. properties in some stage of foreclosure—default, scheduled for auction or bank-owned (REO)—sold to third parties in the first quarter, a decrease of 14% from the previous quarter and down 33% from the peak during the first quarter of 2009, when sales of foreclosure homes accounted for 37% of all residential sales.

“First-time home buyers and investors continue to buy foreclosure properties in large numbers, and at substantial discounts,” said James J. Saccacio, chief executive officer of RealtyTrac. “As lenders have begun repossessing homes at record levels over the first half of 2010, it will be interesting to watch how they will manage the inventory levels of distressed properties on the market in order to prevent more dramatic price deterioration.”

The average sales prices on properties in some stage of foreclosure decreased 23% from 2006 to 2009 while the average discounts on foreclosure purchases steadily increased from 21% in 2006 to 27% in the first quarter of 2010. Discounts on REOs are larger than discounts on pre-foreclosures, although discounts on pre-foreclosures appear to be trending higher as short sales become more common.

Foreclosure sales increase 2,500 percent from 2005 to 2009
More than 1.2 million U.S. properties in some stage of foreclosure sold to third parties in 2009, an increase of 25% from 2008 and an increase of nearly 327% from 2007. Total foreclosure sales in 2009 were up more than 1,100% from 2006 and up more than 2,500% from 2005. Foreclosure sales accounted for 29% of all sales in 2009, up from 23% in 2008 and up from 6% in 2007.

The average sales price of properties that sold while in some stage of foreclosure in 2009 was 25% below the average sales price of properties not in the foreclosure process. That was up from an average discount of 22% in 2008 but down from an average discount of 26% in 2007. The average foreclosure discount in 2005 was 35%, driven by a nearly 50% discount on REOs; however, the discount on pre-foreclosures trended up slightly over the same five-year period, from nearly 12% in 2005 to 15% in 2008 and 2009.

Foreclosure sales by type in first quarter
A total of 144,503 bank-owned (REO) properties sold to third parties in the first quarter, down 13% from the previous quarter and down 27% from the first quarter of 2009. REO sales accounted for 19% of all sales in the first quarter, up from nearly 16% in the previous quarter but down from 21% of all sales in the first quarter of 2009. REOs sold for an average discount of 34%, up from an average discount of nearly 32% in both the previous quarter and the first quarter of 2009.

A total of 88,456 pre-foreclosure properties—in default or scheduled for auction—sold to third parties in the first quarter, down 15% from the previous quarter and down nearly 41% from the first quarter of 2009. Pre-foreclosure sales accounted for nearly 12% of all sales, up from nearly 10% in the previous quarter but down from 16% in the first quarter of 2009. Pre-foreclosures, which are often short sales, sold for an average discount of nearly 15%, up from nearly 14% in the previous quarter but down from 16% in the first quarter of 2009.

Nevada, California, Arizona post highest percentage of foreclosure sales in Q1
Foreclosure sales accounted for 64% of all sales in Nevada in the first quarter, the highest percentage of any state, although Nevada’s percentage was down from 65% of all sales in the previous quarter and 75% of all sales in the first quarter of 2009.

California posted the second highest percentage, with foreclosure sales accounting for 51% of all sales there in the first quarter—up slightly from 50% in the previous quarter but down from 70% of all sales in the first quarter of 2009.

Foreclosure sales as a percentage of all sales were also down in Arizona from the first quarter of 2009, but the state still posted the third highest percentage in the first quarter, with foreclosure sales accounting for 50% of all sales.

Other states where foreclosure sales accounted for at least one-third of all sales were Massachusetts, Rhode Island, Florida, Michigan, Georgia, Illinois, Idaho and Oregon.

Ohio, Kentucky, Illinois post highest foreclosure discounts
The average sales price of properties that sold while in some stage of foreclosure in the first quarter was 39% below the average sales price of properties not in the foreclosure process in Ohio, Kentucky and Illinois—the states with the three highest average foreclosure discounts.The average overall foreclosure discount was at least 35% in California, Tennessee, Pennsylvania, DC and New Jersey.

The biggest discount on bank-owned properties was in New York, where the average sales price for REOs was 52% below the average sales price for properties not in foreclosure. The biggest discount on pre-foreclosure properties was in Rhode Island, where the average sales price for properties in default or scheduled for auction was 33% below the average sales price for properties not in foreclosure.

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Posted by Jackie Mills on June 30th, 2010 9:14 AMLeave a Comment

June 18th, 2010 4:44 PM
How To Make Buyers Want Your Home

You love your home but when it comes time to sell, you have to share the love. In the other words, you have to make your home be seen in the eyes of potential buyers as their home. That can be tricky.


But if you do some of the basic things such as clearing clutter, creating light, bright, and open space, adding curb appeal, removing personal items (family photos, trinkets), fresh paint, and clean or new carpet -- you'll be on your way to attracting serious buyers. I've written a lot about staging and creating curb appeal so check out my other columns for more on those topics.

In this column, however, we're looking at specific areas that create widespread appeal inside the home. Here are some of the top areas to improve: countertops, flooring, built-in furniture, and old-style attached fixtures such as those big sheet mirrors in the bathroom. However, when making these improvements, there's one important consideration.

Functionality is the greatest concern cited by homeowners, according to the latest poll conducted by the National Association of the Remodeling Industry (NARI).

"The functionality of a home is very important, especially over the long term, as many homeowners in this economy have opted for remodeling over moving to new homes," says NARI National President Paul Zuch, CR, president of Capital Improvements.

So let's explore the areas I mentioned earlier and see how improving these items can lead to greater interest in your home. Countertops are fixtures in homes. So making sure that you select the best material to endure the daily wear and tear is important. If we're talking about the kitchen, for instance, there are many options: granite, tile, recycled glass (for a green option), solid steel, composite stone, butcher block, laminate, and even concrete. Yes, that last one sounds surprising but concrete is being used for countertops and laminate isn't necessarily trying to mimic other materials anymore. Instead, homeowners are embracing laminate's own unique high-tech look. The popular trend is a mixing of several styles creating a blended custom look for the kitchen. But in the end, functionality will rate highest for potential buyers. All of the countertop materials mentioned above have advantages and disadvantages when it comes to maintenance and usage; make sure you completely research the material before selecting it for your home.

Fixtures are an important area to improve. "People know a lot more about design," Laura Kirar from Larua Kirar-TRU Design told the Alexandria Times. These days, quirky, eclectic styles from international trends are becoming more prevalent in the United States. However, push the envelope too far with quirkiness and you just might lose a potential buyer. What's important to know is that buyers are paying attention to fixtures. If you have damaged or worn out faucets or lighting, it's best to replace them before showing your home. Also, replacing those big, nothing-special sheet mirrors with some framed mirrors can add a unique look without costing very much. While you don't want to have to spend a lot just before you sell your home, remember that these seemingly small items can have a great impact on improving buyers' interest in your home.

Flooring is a big interest for buyers. Wood floors are still very popular. Many Realtors say buyers are looking for hardwood floors. That's partly because they endure and don't go out of style. However, if they're damaged it can be a drawback because buyers may focus on how much work it will take and cost to do the repairs.

Built-in furniture can improve a home. Built-in bookcases and entertainment centers can save space and help make the room look larger. However, there's a downside. Built-in furniture isn't easily movable. So, potential buyers will have to really find the furniture useful and suitable for their needs. "It's all about personalization—homeowners want to know that their space can be converted easily into a different space in the future," Zuch said in a press statement by NARI. And that's what buyers want as well—the ability to make your home theirs when the sale closes.

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Posted by Jackie Mills on June 18th, 2010 4:44 PMLeave a Comment

May 21st, 2010 12:03 PM

Austin home sales up 31%, condos up 63%

Austin Business Journal

Austin home sales continued to rise last month, increasing 31 percent compared with April 2009, according to Austin Board of Realtors statistics released Thursday.

Home sales for the month totaled $486 million with 2,043 single-family homes sold, according to the Multiple Listing Service report. When compared to April 2009, the median price of real estate was unchanged in Austin at $190,700. Most promising, pending sales increased 47 percent to 2,813.

Home sales also increased month to month compared with the March $422 million sales total, or 1,784 single-family homes sold. The median price also rose by $10,700 from March to April this year.

“The considerable increase in sales and pending sales indicates increased activity among buyers trying to beat the April 30 tax credit deadline,” Austin Board of Realtors Chairman John Horton.

“Although the tax credit has expired, we are entering a growing economic, real estate and seasonal cycle which we hope will continue to provide momentum to carry our market upward.”

Condo and townhouse were also strong in April, increasing 63 percent to 213 sold compared with the same month 2009. Also during the same period, pending sales for condos and townhouses increased 70 percent to 338.

“The significant increase seen in the condo and townhouse market can most likely be attributed to the first-time homebuyer tax credit,” Horton said. “The median price for condos and townhouses is approximately $30,000 less than the median price for a single-family home; and therefore, these properties can be a more affordable alternative for first-time buyers.”

Realtors are still holding their breath to see if sales drop this month with the tax credit ending, but Horton remains optimistic because the month’s supply of inventory in April was approximately 6.5 months, which represents a balanced market.

“There are a lot of buyers who have been waiting to purchase until they were confident in the economy,” Horton said. “Now that we are seeing recovery in the economy and real estate market, in combination with historically low interest rates, those potential buyers who have been on the fence are now taking the leap and entering the housing market.”

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Posted by Jackie Mills on May 21st, 2010 12:03 PMLeave a Comment