Austin, Texas is a fast-growing metro area, and homebuyers are being challenged by shrinking inventories and rising prices. As the latest wave of residents settles into homes they can afford, yesterday’s “transitioning” Austin neighborhoods have become today’s trendy locales. Properties in these areas may be good investments for their lucky owners. The East MLK neighborhood, for example, was once well-known for its abundance of low-income housing, and today, the median price of listings in the area continues to climb. If you’re looking to move to one of the hottest neighborhoods in Austin, here’s what you should know before starting your search.
5 Affordable Austin Neighborhoods
Several Austin communities stand out in terms of affordability and amenities. Here’s a quick rundown:
- North Loop: This quiet, walkable community is adjacent to the expensive Hyde Park area, and is listed as a top neighborhood for those who are young and creative, says Backstage.com. The average price of homes in this area is $281,433.
- Lakeway: This Austin suburb boasts a relatively low median home price of $368,900, and offers resort-style living just minutes away from the city of Austin.
- Pflugerville: Dominated by young adults, Pflugerville is an affordable neighborhood of single-family homes that are popular with young families. Homes in this area have a median price of $168,500. This Austin suburb is currently one of the fastest growing towns in the U.S.
- Southwood: Quirky Southwood benefits from its proximity to more expensive communities like Bouldin Creek. It’s viewed as a less expensive alternative at a median home price of $250,000, and its population of over 5,500 has an average age of 44. The neighborhood is dog-friendly, eclectic and offers a diverse vibe.
- East Austin: Increasingly popular East Austin is on the verge of exploding in popularity, according to Built in Austin. This bikeable community is home to dozens of great restaurants and bars and an up-and-coming tech scene. A home in this area averages $244,380.
Spotting Potential in Austin Neighborhoods
If the latest and greatest areas are beyond your price range, try to spot future hot spots before the next wave of buyers pushes its prices through the roof. Experts at Money Crashers say there are clues — pay attention to an influx of artists or musicians; redevelopment efforts by local governments; proximity to other trendy communities; increasing prices at local businesses; growing popularity with younger citizens; and the establishment of hot restaurants, galleries, bars or night clubs. For instance, check out Eater Austin’s Cocktail Heatmap, which shows where the trendiest bars and restaurants are located. Those may be the neighborhoods to target in your home search.
Other signs of impending prosperity are whether an area is walkable, bikeable or close to employment opportunities. Beto Juarez, founder of mortgage software company Nest Mortgage, says his East Austin neighborhood fits the bill. “The amount of bikes on the East Side far surpasses any other neighborhoods because of the flatness and proximity to other areas to hang out.” When asked about his neighbors, Beto says, “It is indeed popular with younger residents. This traditionally Latino area still has many older residents, but the new ones are almost exclusively in their 20s through 40s.” The bottom line is that it’s the next generation that breathes fresh life into a formerly tired neighborhood.
One factor in the growth of home prices is the level of gentrification. Governing.com studies census tracts and classifies them as gentrified, not gentrified and not eligible for gentrification. Its map of Austin shows areas that might be the best bets for future price increases. With plenty of areas to choose from, there is ample opportunity for real estate investments in this thriving, lively city.
New Home Developments
Those who prefer a new home can find entry-level residences in many parts of town. Tim Towell, president of Taylor Morrison’s Austin division, recommends checking out new home communities in Bee Cave, Leander, Dripping Springs, Round Rock and Rocky Creek. There’s a home for you, he says, “whether you’re looking for a home tucked away from the busy city or a neighborhood bustling with resort-style amenities and things to do.” Prices range from the mid-$200,000s to the upper-$500,000s.
Redevelopment Area Benefits
Not only can you find a good investment in Austin neighborhoods that are slated for redevelopment, but there are other benefits, such as down-payment assistance of up to $40,000 for eligible homebuyers. The Mueller Boulevard Master Plan is also focused on redeveloping East Austin neighborhoods, which will be walkable and mostly within 10 minutes of public transportation. It’s expected to serve more than 20,000 people, and adjacent existing neighborhoods may benefit from the upgrades as well.
If, like many, you’re considering making the move to Austin, start by considering these tips. With the right research and knowledge, you can purchase a home that may end up being an excellent investment. When you’re ready to officially start your search, head to Owners.com to get started.
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Owners.com, Altisource or any other Altisource® business or entity. The foregoing content is not intended to constitute, and in fact does not constitute, financial, investment, tax or legal advice by the author, Owners.com, Altisource or any other business or entity.