New home starts in Austin has slowed down according to new study by the real estate research group, Metrostudy. During the 3rd quarter of 2007 home building starts fell 27% from 2006. The majority of this drop off was for homes under $150,000 due to the tighter credit policies on lending. This is has knocked out a number of first time home buyers.

“The Austin area will experience less demand for new homes in upcoming quarters.“ A sharp decline in relocation buyers, a competitive resale market and more hesitant home buyers are factors leading to the slowdown, as are decisions by corporate offices of the region’s largest builders....Austin experienced only moderate appreciation in new home pricing in recent years" and this will, to a large extent, insulate the area from large price reductions that will plague the new home and resale markets in other parts of the country."

We still see a very competitive resale market and think prices will continue to rise a modest rate. So if you are a buyer trying to 'time" the market wouldn't be advised as you will be paying probably 5-6% on a home a purchase. Again this varies by areas of town. Consult your Realtor to find out about specific neighborhoods or subdivisions.


See the full article here: Homebuilding Slows Down in Austin