Spring and summer is typically the busiest season for Austin's real estate market. But since the pandemic hit in March, only the housing sector has seen improvements.
The Austin metro saw a 21.5% year-over-year increase in home sales last month, with the median sales price climbing more than 10%. Rentals, on the other hand, are still struggling to recover from the financial hits.
"[March to July] is our peak leasing season, so historically there are usually pretty good size gains month over month this time of year," said Cindi Reed, vice president of regional development for ApartmentData.com. "This is not typical for this time of year."
On the homefront
Recent strong home sales indicate that the local market is bouncing back, despite the ongoing pandemic.
"July was a very encouraging month for the Central Texas housing market," Austin Board of Realtors President Romeo Manzanilla said in a Wednesday press release. "[W]ith two consecutive months of positive numbers, we are growing more confident that this is sustainable and can help be the spark that gets our economy back on track."
Manzanilla attributed the recovery to Austin's "dangerously low" housing inventory, which makes the housing market "ultra-competitive," and with "historically low" interest rates.
Recent economic development initiatives may also responsible.
Laura Huffman, president and CEO of the Austin Chamber of Commerce, said demand for housing is driven by the recent arrivals of electric car manufacturer Tesla, which promises 5,000 jobs at its forthcoming Southeast Travis County Gigafactory, and defense contractor BAE Systems, which announced last week plans for a new campus at Parmer Austin Business Park that will house more than 1,400 employees.
"Even amidst the pandemic, Austin still shines as a magnet for companies that appreciate our robust business climate and abundant talent pool," Huffman said in the same release.
The median home price in the city of Austin is now $423,000, up 11.3% from last year, according to ABoR data. This growth extends to the surrounding areas, including Williamson and Hays counties, which both posted double-digit year-over-year increases in overall sales and median home prices.
A renter's market
The Austin apartment market, however, is another story.
Since March, the average monthly rent in Austin has declined by about $37, or around 3%, according to a market report compiled by ApartmentData.com.
Reed attributes this to a combination of factors, including low interest rates spurring homeownership; a large amount of new and forthcoming inventory, including at least 49 Austin complexes in the pre-leasing stage; and what she feels is a decline in the number of people moving.
Class A, or luxury, apartments, have seen a more "significant decline" in Austin, with their average monthly rent down nearly 5% in the same period. Downtown, which primarily offers Class A units, has proven to be one of the worst performing submarkets during the pandemic period.
"I have to speculate and wonder: Who wants to pay the high price to live downtown but you don't get the benefits of the urban lifestyle?" Reed said, explaining that COVID has temporarily shut down a lot of the bars, restaurants and music venues that draw people to the area.
While there are some signs that the rental market may return to its pre-pandemic state—including a slight increase in the average rent from June to July and the return of students to college campuses—the apartment industry is still vulnerable to the COVID-19 recession.
Many landlords are worried about rental collection now that stimulus funds have likely run out and evictions remain on hold.
"There's a lot of fear of what's going to happen moving forward," Reed said. "It could go either way."
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East Austin restaurant la Barbecue has been robbed a third time in less than three months, according to a post on the restaurant's Instagram.
In the post, the restaurant included photos of what appeared to be a man exiting a minivan from surveillance footage.
"This guy pulled up in a car full of stuff… he ripped our gate open and stole a couple empty kegs," the post said. "The ring system scared him off so he did not venture back into the area. PLEASE EVERYONE ON THE EAST SIDE BE CAREFUL!!! This guy goes back into his car to grab something before he goes in. I am hoping he won’t be back!!"
The robbery comes as many restaurant and food truck owners have been on guard from recent break-ins. East Austin cheesesteak truck R&B's Steak and Fries has also been robbed three times in around three months, according to owner Kris Elliott. Elliot said the truck was last robbed around a month and a half ago.
"When the weather gets cold, it seems like these things start to happen more often," Elliott said. "We're just happy no one got hurt."
Additionally, he said all 5 of the food trucks in their lot have experienced burglaries. The landlord of the space is taking action by investing in alarm and camera systems. "Been very tough dealing with this problem as us small business owners are just trying to survive during the pandemic," Elliott said.
And it's not just in East Austin. North Austin restaurants Eldorado Cafe and Chez Zee Bistro were both broken into and robbed on the weekend of Jan. 8, while over a dozen food truck robberies and break-ins were reported in the latter half of 2021.
Some, like Chez Zee's Deborah Velasco, wonder if the understaffed Austin Police Department's decision to no longer respond to non-emergency calls is part of the problem. Xose Velasco, owner of East Austin's Discada, said owners are keeping their guard up in the wake of the robberies as he was robbed twice within a month of reopening in November 2021.
"We try to keep the lights on," Velasco said. "We're a little bit more careful."
After 12 months, the long-anticipated massive Tesla factory in Southeast Travis County is up and operating and everyone wants a look inside.
Phase 1 of Giga Texas appears to be tied up as production of the Model Y Tesla is underway, the electric car company revealed on Wednesday in its fourth-quarter earnings call. The factory, located on the former Harold Green-turned Tesla Road, sits on more than 2,000 acres of land in southeast Travis County.
Here's a glimpse inside the factory.
Model Ys will be the first Teslas to come out of Giga Texas with an estimated delivery of August. The wait estimate comes after Tesla noted supply chain issues have affected their factories, which have been running below capacity for several quarters. A deep blue metallic like this goes for $1,000 more than a white or silver Model Y, totaling $61,990.
Model Ys began being produced at Giga Texas at the end of 2020. In general assembly at the factory, the Teslas get their major interior components to finish the vehicle.
Workers at Austin's Gigafactory are attaching seats to a structural battery pack. It's been described by some as the biggest difference between Texas-made Model Y's and the current version at the Fremont, California factory. It shouldn't have a major impact on the owner's experience, but Tesla has updated instructions for the jacking procedure, as the lift points are different.
With a sleek, open office setup, workers can take in a view of the factory from their seats. It's a component CEO Elon Musk wanted for what is now the headquarters of Tesla.
On the Austin, Texas public location Snapchat, a photo of inside Giga Texas has appeared. On the left you can see a sneak peek of a Model Y body.pic.twitter.com/N7zliZ5vkL— Sawyer Merritt (@Sawyer Merritt) 1643081462
With Snapchat's maps, anyone can look at everyday activity happening at the factory. To view these geographically-linked stories, click the bottom left "map" icon and search "Tesla Giga Texas." Once you've found it, you can view the Snapchat story of those in and around the facility. While most stories stay up for only 24 hours, Giga Texas is a designated place on Snapchat, allowing users to view a collection of photos and videos from the inside.
Following Model Ys, Texas-made Teslas will include the Cybertruck, Semi and Model 3. But it might be a while before those other models arrive. EV makers have been hit hard by the chip shortage, and it's thought that changing features are contributing to Cybertruck delays as Tesla works to compete in the electric pickup market.
Joe Rogan paid a visit to buddy Elon Musk this week. The two have been seen around town since both moving to Texas. Naturally, Rogan was impressed with the prototype.
If you're dying to get a closer look at this factory, you just might get to. In December, Musk said the factory would have tours available to the community early this year.
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