Austin’s Housing Market Trends – Q&A with Mark Sprague

Mark Sprague, Mission Mortgage of Texas, Inc.Q&A WITH MARK SPRAGUE
Mark Sprague is a noted and respected expert on the real estate industry and the Austin market, in particular. He is also the Director of Business Development for Mission Mortgage and we are fortunate to have access to his expertise and opinions. Recently, Mark was asked questions regarding trends in the Austin housing market. Here are the questions and his responses.

 

QUESTION: What’s your take on the housing market for homes in the $1,000,000 to $2,500,000 range?

ANSWER: Demand will come at different levels in different price channels and locations, with $200K to $500K being projected to be the strongest channel over the next few years due to demand and lack of inventory. As with all real estate, however, purchases will be highly location driven. Homes priced from $1 Million to $4 million is still a challenged market with a lot of inventory, particularly west of 360 in Austin.  The supply of homes in this price range, when compared to sales data, indicates that there are years of inventory to work through.  However this has happened before. Most markets can be healed by job creation, which Austin continues to blessed with.

QUESTION: Which subdivisions are seeing the most new starts?

ANSWER: Based on available data and anecdotal evidence, these subdivisions appear to be experiencing the most new starts.  The list is presented in alphabetical order.

Belterra
Crystal Falls
Falcon Point
Falconhead
Paloma Lake
Ranch @ Brushy Creek
Sun City
Steiner 
Teravista
Walsh Trails

QUESTION: Which builders are getting the majority of the business?

ANSWER: Total starts have dropped. In the last 12 months, we saw just 5,800+ new home starts in this area and it is projected that this year will show similar results. Over 4,000 of those starts were created by just 10 builders.  The remaining 1,800 starts were spread out among all remaining builders in the area.  The top 10 builders recently, in terms of starts, are listed below in alphabetical order.

Buffington
D R Horton
Gehan
KB
Lennar
Meritage
PulTex (Pulte/Centex)
Stan Pac
Taylor Morrison
Weekley Homes

QUESTION: Proportionately, which is increasing its volume more:  resales or new construction?

ANSWER: Resales will run about 18,000 to 22,000 this year.  Values are up, sales are down a little.  Presently resales are attracting a strong audience in the lower values due to foreclosures and short sales.  With new home starts projected to be around 5,800 this year, it is clear that resales will represent roughly 3 times the volume of new home construction.  Neither market (new or resale) is drastically increasing volume currently.

Mark would like to thank the people who show a genuine interest in what he is saying and he appreciates the questions that he has been receiving. If you have questions that you’d like Mark Sprague to answer, please send them to us at marketing@missionmortgage.com.  Even if we don’t post your question on our blog, we’ll get you an answer.
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About missionmortgage

A full-service professional mortgage banker providing lending in Texas for over 25 years. Our main office is located at 901 S. Mopac Expwy, Barton Oaks V- Suite 120, Austin, TX 78746 with branches in Lakeway, Houston, and Sealy. Mission Mortgage has been ranked as a Top 10 Mortgage Company in Austin for the past 7 years (Austin Business Journal).
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