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  #1  
Old Posted Aug 12, 2007, 5:03 AM
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Arrow Discuss Austin's residential market

I was thinking we should have a thread on Austin's residential market and or market news.

Last edited by KevinFromTexas; Sep 27, 2013 at 5:51 PM.
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  #2  
Old Posted Aug 30, 2013, 7:54 PM
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Austin Skyhouse

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Last edited by Solutioneur; Sep 27, 2013 at 11:46 PM. Reason: Comment moved by Admin
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  #3  
Old Posted Aug 30, 2013, 8:09 PM
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This tower is the result of tremendous pressure on costs for high-rise residential. Sky House has a quality exterior and was built quickly, but the interiors are perhaps the worst (cheapest) we've seen for new projects in Austin. The floorplans look like student housing. Rents are projected at $2.50-$3.00 PSF. Amenities are minimal.

I think it will be difficult to get $2.50 SF rent in a $1.50 location. Unfortunately, because of the shortage of urban rental units, renters will be initially fooled. The interior quality of this building is substandard - let's see how long it takes to realize that.
Your brief posting history is all pretty negative towards Austin and San Francisco. You seem to have an agenda
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  #4  
Old Posted Aug 30, 2013, 9:54 PM
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Value engineering

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  #5  
Old Posted Aug 30, 2013, 11:02 PM
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I wonder if that phenomenon could be because of outsider perceptions of what downtown Austin is. Could it be that they are assuming our downtown is nothing more than a collection of vertical housing for college students? I would assume and hope they are doing their homework before they actually develop, but I have to wonder if that isn't the case.
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  #6  
Old Posted Aug 30, 2013, 11:24 PM
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  #7  
Old Posted Aug 31, 2013, 12:04 AM
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I don't think you know what you're talking about. The floor plans are standard for any VMU development at all, whether they be college geared or not.

Price points, getting back to your other suggestion, have very little to do with just quality (except in the most basic way possible, by which I mean that in a locale the worst done projects will fetch the lowest prices and the best done projects will fetch the highest, but mitigated by specific location), but rather to do with supply and demand dynamics that are locally determined. Austin has a hot market - and developers are having a very difficult time catching up to demand - so even mid-level quality projects can fetch very high rents.
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  #8  
Old Posted Aug 31, 2013, 10:06 PM
austlar1 austlar1 is offline
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My comments are directed at the economics of some of these projects. It's very clear in Austin that highrise residential is getting cheaper and cheaper. Look at the floorplans for SkyHouse, it's basic student housing. Look at the prices, too. Because traditional construction cannot deliver a product at market value they continue to deliver cheaper buildings. That's why this particular building is being built in 6 different cities.

Have a closer look. That's not negative.
Don't be discouraged from expressing your opinions, assuming you know your facts. Some people on this forum get very protective when they think there is Austin bashing going on. The boosterism gets a little ahead of itself sometimes, especially when facts are presented that might question the quality, integrity, or even the likelihood of a project. I agree with you that a lot of the rental projects are poorly designed and constructed and fail to deliver a real quality product. This will interfere with some of these projects ever converting to condo down the line. I guess that will guarantee a supply of rental units over time, so it may be a mixed blessing.

In fairness I think it is worth noting that most of the new rental construction taking place on streets like S. Lamar or in central east Austin is also not being built with much integrity. The most substantial element in any of these stick-built units seen outside of downtown is the multi-story concrete parking structure that lies at the core of each of these buildings. The high rise buildings may have more fireproof building materials used in construction, but the walls are tissue thin, the plumbing fixtures are mediocre, and the floor space and storage is tight at best except in the most expensive units. I recently visited a friend for dinner at the Windsor (formerly known as the Legacy BTW) on the Lake. The amount of noise audible from next door and from the unit underneath was unreal. I could imagine sitting at home at bed time just fuming at the price I had to pay to listen to my neighbors music and partying. This is not a problem that was typically part of high rise living in older buildings, but it does reflect the lack of attention to these matters by today's typical apartment developer.

Last edited by austlar1; Aug 31, 2013 at 11:08 PM.
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  #9  
Old Posted Sep 1, 2013, 5:55 PM
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Building quality/finish Vs. Rental rates

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Last edited by Solutioneur; Sep 27, 2013 at 11:48 PM. Reason: Comment moved by Admin
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  #10  
Old Posted Sep 3, 2013, 4:38 AM
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Quote:
Originally Posted by Solutioneur View Post
This tower is the result of tremendous pressure on costs for high-rise residential. Sky House has a quality exterior and was built quickly, but the interiors are perhaps the worst (cheapest) we've seen for new projects in Austin. The floorplans look like student housing. Rents are projected at $2.50-$3.00 PSF. Amenities are minimal.

I think it will be difficult to get $2.50 SF rent in a $1.50 location. Unfortunately, because of the shortage of urban rental units, renters will be initially fooled. The interior quality of this building is substandard - let's see how long it takes to realize that.
There are no $1.50 locations anywhere in 78701, but you can still find them in '02. You are 5 years too late.
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  #11  
Old Posted Sep 3, 2013, 4:57 AM
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Originally Posted by Solutioneur View Post
During the last 5-7 years we can see clearly that all developers have been able to accomplish are higher prices for cheaper quality construction. Maybe the renters haven't caught up to that reality, but they will.... soon.
Or maybe it has to do with supply and demand entirely...
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  #12  
Old Posted Sep 3, 2013, 4:12 PM
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Plenty of demand

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Last edited by Solutioneur; Sep 27, 2013 at 11:48 PM. Reason: Comment moved by Admin
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  #13  
Old Posted Sep 3, 2013, 8:51 PM
AusTxDevelopment AusTxDevelopment is offline
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To help clear up the debate over what Austin apartment rates really are, below is the 2nd quarter 2013 average rental rate by class for Austin area apartments. All of these are per square foot. Downtown is "CBD" (Central Business District) on this list, and other abreviations are locations - for example, FN is Far North, NW is Northwest, NWH is Northwest Hills, SM is San Marcos, CP/L is Cedar Park/Leander, and so on. These are averages, so yes there are some Class A downtown apartments that are renting for $3.00 per foot, but there are others that are quoting less so it all averages out. This comes from a quarterly report by AII, which you can purchase here if you like: http://www.apartmenttrends.com/

Edited to add: Here's the map that shows the boundries of those submarkets. http://www.apartmenttrends.com/html/maps/submarket.cfm


Last edited by AusTxDevelopment; Sep 3, 2013 at 9:08 PM.
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  #14  
Old Posted Sep 3, 2013, 9:22 PM
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In other words, Solutioneur's assertions are not backed by data.
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  #15  
Old Posted Sep 3, 2013, 9:37 PM
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I like my criticism specific, please.

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Last edited by Solutioneur; Sep 27, 2013 at 11:48 PM. Reason: Comment moved by Admin
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  #16  
Old Posted Sep 4, 2013, 5:30 PM
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I'm sorry, but downtown Austin is the BIGGEST urban ripoff in the country right now. Do a quick search for condo's in Chicagos urban area(dt, river north etc etc) and you can find 2/2 condo's going for under 300,000...and theres a lot of em. Here in Austin, do the same search, there is NOTHING out there and if there is....its very very expensive.

I understand our supply is way lower than chicagos, I understand that. However, why pay almost twice as much for a condo in an urban area which will never touch chicagos?

Rip off
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  #17  
Old Posted Sep 4, 2013, 6:42 PM
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Supply and demand, bro. Supply and demand.
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  #18  
Old Posted Sep 4, 2013, 7:52 PM
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Originally Posted by wwmiv View Post
Supply and demand, bro. Supply and demand.
I will agree. If downtown Austin is not appealing to an individual then the prices will seem unreasonable. If it is an appealing destination, they will seem reasonable.

It truly is simple.

I must say however, I have agreed that housing being built is a bit what I call "LCD": Lowest common denominator. Developers are taking advantage of demand. Which kinda points out there is a lot of demand!
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  #19  
Old Posted Sep 4, 2013, 8:09 PM
jtown,man jtown,man is offline
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Supply and demand, bro. Supply and demand.
Man, I understand that, it is just eye popping to see the difference in the two markets. I just wished a developer would build a 100 story apt building and 100 story condo building to flood us with some units
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  #20  
Old Posted Sep 4, 2013, 8:44 PM
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Man, I understand that, it is just eye popping to see the difference in the two markets. I just wished a developer would build a 100 story apt building and 100 story condo building to flood us with some units
A single development of that size doesn't make sense, but you do realize that that's why we have all of these units in the pipeline now? To increase supply.
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