City Council hears report on local housing situation
Published 6:40 pm Tuesday, May 17, 2022
The City of Austin seems to be grappling a little bit with the saying, “too much of a good thing.”
That was what the City Council heard during a Monday night work session after being delivered a report from the Counselors of Real Estate looking into how to improve and expand Austin’s housing supply.
While there are a number of areas that are contributing to the housing crunch, one of those problems is an already high number of existing homes in the city.
According to the group from CRE, single family home new construction homes over the past 10 years has been just 1% while existing single family homes currently occupied stands at 61%.
“You’re impacted by a large number of existing single family houses,” said CRE’s Steve Price, who said that single family homes being constructed is something akin to the canary in the coal mine in terms of identifying other areas of concern.
Another problem is that developers aren’t seeing much in the way of incentives for building in Austin.
“… they aren’t building houses because they aren’t getting enough of a profit margin,” Price said.
“You need to do some marketing to the builders and developers as well and give them a reason to come to town as well,” Price later added.
On the heels of that was the discovery that while a good program for first-time home builders, the tax abatement program hasn’t done as well as expected.
“That pipeline of houses largely stayed the same,” Price said. “The program has not resulted in a boon for new homes. That indicates that the initial cost is probably not the only factor limiting the number of new housing starts.”
Yet another issue is those currently living in single family homes tend to be baby boomers who are not inclined to move out of their homes.
All this taken together shows a community that needs expanded housing options and if the city doesn’t take the necessary steps then the inevitable is all too real.
“People are going to alternative markets,” Price said.