New Braunfels Edition | July 2021

CONTINUED FROM 1

THE FLIGHT TO

New Braunfels MEDIAN HOUSEHOLD INCOME

Residential value

Across Central Texas, the growth in real estate value is vastly outpacing the growth in personal income. While rst-time homebuyers or families looking for a more aordable house often look away from cities, data shows even the suburbs and area communities are following the same rapid price growth pattern. Appraisal district data for 2021 is preliminary and does not yet include the result of property owners’ protesting their appraisals. affordability

15.3% INCREASE

$61,618

2016

COMAL COUNTY

GUADALUPE COUNTY

$71,044

Total value: $20B $15B

2019*

INCREASE 41.12%*

INCREASE 76.13%*

*MOST RECENT YEAR AVAILABLE

New Braunfels MEDIAN HOME PRICE

$10B $5B

18.65% INCREASE

$239,776

2018

$284,500

2021*

$0

*YEAR TO DATE AS OF MAY

2016 2020 2021

2016 2020 2021

DESIGNED BY RACHAL RUSSELL

SOURCES: COMAL COUNTY APPRAISAL DISTRICT, FOUR RIVERS ASSOCIATION OF REALTORS, GUADALUPE COUNTY APPRAISAL DISTRICT, U.S. CENSUS BUREAUCOMMUNITY IMPACT NEWSPAPER

*2021 VALUES ARE PRELIMINARY BECAUSE APPRAISAL DISTRICTS HAVE NOT YET PROCESSED APPEALS

of inventory available, according to the Austin Board of Realtors. Months of inventory is a measure of how long it would take to sell all existing properties on the market. A balanced market, according to Gaines, has about ve to seven months of inventory. “I think this is unprecedented, the way builders are selling homes; I’ve never seen anything like it in Adrianne Craft, a real estate broker who is licensed with Keller Williams Realty, said buyers are having a truly dicult time nding homes—and not just in the Hays and Comal county areas where she is largely focused. “A year ago, I would say that buyers could be a little bit pickier as far as the condition of a home goes,” Craft said. “A buyer may choose a house over another house because it doesn’t have carpet, or it has white cabinets. …Whereas now, buyers are hav- ing to just concede on everything.” Craft added that every deal she has brokered this year has seen multiple oers for which homes are typically selling for 10%-20% over asking price. This is a situation that frequently does not favor rst- time buyers, especially those seeking single-fam- ily homes, which account for the vast majority of homes on the market at any given time, she said. One solution ocials in cities throughout the Greater Austin area have been examining over the last several years involves diversication of home types. Dan Parolek, CEO of Opticos Design, a California rm that helps collaborate on housing and com- munity issues, has given many presentations to city ocials throughout Central Texas, from New Braunfels to Austin. Parolek’s presentations center on a concept called missing middle housing, which involves homes from duplexes to townhouses to buildings with eight units, and which are walkable, or located near business or city centers that have popular amenities. These options, Parolek said, oer more aordabil- ity for people including rst-time buyers who cannot make cash oers in order to become homeowners. “Every market, regardless of how big the city, has been impacted pretty dramatically by the increase in costs,” Parolek said. “It’s become harder for … sort this industry,” Boenig said. Alternatives to single family

is] becoming less aordable,” Gaines said. That breakneck pace of price increase cannot last forever, according to Patricia Fernandez, 2021 pres- ident of the Four Rivers Association of Realtors. Eventually, Fernandez said she expects the price to return to some level of normalcy, although that could take years as supply catches up with demand. “Builders are building as fast as they can, but you know that still takes time. It’s ... not an easy pro- cess.” Fernandez said. “I mean, it takes years for development just to get the groundwork done.” ‘Perfect storm’ of construction challenges Even with demand potentially leveling o after the pandemic as individuals begin reprioritizing their spending habits, increasing supply remains dicult for many builders. AaronBoenig is the co-president of BrohnHomes, a developer that focuses on homes that are in the price range for rst-time homebuyers. The company builds homes from Georgetown to Bastrop to San Marcos— areas less expensive than Austin—but Boenig said it is increasingly dicult to build at a mid-range price point even in outlying areas. Land prices are one factor making it harder for developers to build aordable homes, but Boenig said buying the land is only one challenge. Long waits for building permit approvals, the jump in materials prices—especially lumber—and labor shortages are also aecting developers. Boenig called it a “perfect storm” that is restricting supply. In the Austinmetro as of May, there was 1.3months

ACentral Texas seller’s market illuminatesnew trends for homebuyers

BY LAUREN CANTERBERRY, JACK FLAGLER & BRIAN RASH

Eric Bramlett has been a Realtor in Central Texas for 18 years, and he said since the end of the 2008 economic recession, the local housing market has been consistently strong, following consistent sea- sonal patterns and holding relatively steady in total sales and price. But something happened around the middle of 2020 that led the market to take o, according to Realtors and economists. Due to the increase in telework brought on by the COVID-19 pandemic, they said, many newly remote workers moved in from other, more expensive, cities, no longer tied to their commutes. Locally, employees using their homes as oce space thought dierently about their needs. While unemployment levels reached the double digits nationwide, those who did keep their jobs built up disposable income. “We were the hottest market, and we essentially dumped gasoline on it,” Bramlett said. Before April 2021, the monthly median sale price of a home in New Braunfels had never broken the $290,000 mark, according to data tracked by the Four Rivers Association of Realtors. The median price rose to $295,001 in April 2021, and in May, the most recent month available, the median sale price for homes sold in the city was $316,228. Those incredibly rapid price increases are creat- ing an aordability challenge, according to James Gaines, research economist with Texas A&M Uni- versity’s Texas Real Estate Center. “You don’t have to have a Ph.D in economics to understand that if prices go up faster than incomes, and home aordability is based on the relationship between income and price, then [homeownership

Every market, regardless of how big the city, has been impacted pretty dramatically by the increase in costs. It’s become harder for … sort of entry-level households to purchase homes.

DAN PAROLEK, CEO OF OPTICOS DESIGN

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