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Austin could become the most expensive city outside California by the end of 2021

360 Condominiums on 360 Nueces Street is home to more than 430 luxury homes. (Laura Figi/Austonia)

Boomtown Austin is now the seventh least affordable city in the U.S. and is expected to become the least affordable metro area outside of California by the end of the year, according to a new Zillow report.


Sandwiched between Riverside, California and Miami-Fort Lauderdale, Florida, Austin fell six spots on the affordability rankings. By the end of the year, the capital city is expected to pass historically expensive cities like Seattle and New York.

In a healthy budget, rent should eat up no more than 30% of one's monthly income and anything above is considered "housing burdened." According to Zillow, monthly rent consumed 28.6% of renter budgets in Austin in June 2021 and that portion is set to rise to 29.6% by December.

As for homeowners, mortgage payments took up 25.3% of homeowners' monthly income in June and are expected to rise to 30.1%, effectively becoming a burden, in December. By then, the only more expensive markets will be in sunny California.

If mortgage rates stay the same, the average Austin metro-area homeowners will pay $3,021 per month. If the rates rise by 3.5% or more, mortgage payments will increase to $3,125.

What's hurting:

An influx of California migrants, which Zillow calls the "Great Reshuffling," have historically come in with larger salaries in search of cheaper property. People who are used to paying higher prices for lodging may be able to stomach the housing increase but many Austin residents will not.

Fortunately, Zillow says "rapid deterioration in affordability is likely to contribute to a slowdown in appreciation going forward" because "as these conditions persist, affordability will suffer and home value appreciation and rent growth are likely to slow over the mid- to longer-term."

What may help:

In order to get housing costs back on track to an affordable level, Zillow said relaxing zoning restrictions may help as it creates easier paths to building more inventory. By increasing the supply of affordable housing units, including high-density units like condos and apartments, it could help bridge the gap for those who can't afford current prices.

As of June, 18 of the 50 largest metro areas are paying more than 30% for housing each month. By the end of December, that number is expected to jump up to 21, and Austin isn't far behind.

Popular

Tito's releases (not so?) ugly sweater line for the holidays, profits to charity

Tito's Handmade Vodka

Show your love for Tito's and for the community this year with a wide selection of not that ugly, uglyish, ugly, uglier, and ugliest holiday sweaters.

There's lots choose from, and plenty of accessories like scarves and socks, plus gear for your dog, too.

All of the items can be purchased online or at the Love, Tito’s Retail Store in Austin, TX. 100% of all net proceeds from online or in-store purchases go to one of the nonprofits we’ve teamed up with.

Click here to see the entire collection in the Tito's store.

Mac and Cheese Fest and Free Art Exhibit
Waterloo Greenway, Good Vibrations Installation


🗓 All weekend

🎨 Creek Show Art Exhibit

Check out this highly anticipated art exhibition with illuminated art along Waller Creek. Tickets are free and the event includes food vendors, dazzling lights, live music, and hands-on activities

All weekend 6 p.m - 10 p.m | 📍Waterloo Park

✨ Mozart's Light Show

This iconic holiday tradition lights up for the first time this holiday season starting this weekend! Reserve your spot for an enchanting light and sound performance, delicious hot cocoa, sweet treats, and some overall fun with your friends or family. The show runs till January 6th.

6 p.m and 9 p.m | 📍Mozart's Coffee Roasters - 3825 Lake Austin Blvd, Austin, TX 78703

🗓 Saturday

🥊 Kickboxing in the Park

This fitness event is free and open to the public. Get your morning started right with a "Fitness in the park" class for kickboxing! The class will be led by certified instructors and is a great way to get a cardio workout in while also honing your self-defense skills.

10 a.m - 11 a.m | 📍 Metz Park

🛍 The Front Market

Support local LBGTQ+ and female artists at this outdoor market with over 150 vendors. Get your holiday shopping out of the way at this event, with vendors for food trucks, handmade goods, raffles, hands on workshops and activities, and more.

11 a.m - 5 p.m | 📍Ani's Day and Night - 7107 E Riverside Drive, Austin, TX 78741

🗓 Sunday

🧀 Mac and Cheese Fest

Did someone say cheese?! If you're like me and always willing to get your hands on a bowl of mac and cheese, then this event is for you. Check out the Mac and Cheese festival happening this weekend to decide which vendor has. the best mac and cheese for yourself, and enjoy the bar with creative cocktails while you're at it. Tickets start at $45.

11 a.m - 3 p.m | 📍Lantana Place - 7415 Southwest Parkway