Construction on new homes in the Austin area rose nearly 8 percent in the third quarter as builders scrambled to make up for time they lost due to inclement weather earlier in the year, new figures show.
Homebuilders started construction on 3,530 houses in the third quarter, a 7.95 percent increase from the same quarter last year, Metrostudy said Monday in its latest home-starts report for Travis, Williamson, Hays, Bastrop and Caldwell counties.
“We were expecting a sharp increase in the third quarter as builders play catch up on the building days lost earlier in the year,” including the consistently wet weather in the second quarter, said Steve Plevak, regional director of Metrostudy’s Austin office.
He said dry weather since the end of June has allowed builders to catch up on starts and has allowed developers to deliver lots that were delayed earlier in the year.
For the 12 months that ended in September, builders started work on 11,555 houses, Metrostudy said. That’s a 7.6 percent increase from the 10,735 annual starts in the prior 12-month period.
With prices continuing to rise in the market, affordability remains an issue in the region, Plevak and other housing experts say.
“Austin’s solid economic and job growth make it a vibrant market, certainly an attractive one for relocations,” said Chris Little, division president at Perry Homes, a large Texas homebuilders that recently expanded into the Austin market.“This helps explain why demand for housing is outpacing supply at this time.”
The median price of new homes that buyers moved into during the third quarter was $267,613, up 5 percent compared with the same quarter last year, Metrostudy said. The median price of pre-owned homes was $263,100, up 8 percent over last year, according to the Real Estate Center at Texas A&M University.
Shaun Cranston, senior vice president of Brookfield Residential Properties, said escalating prices are causing some buyers to look to the suburbs.
Addison, a new Brookfield master-planned community in southeast Austin, has already had 125 sales since its launch in April, Cranston said.
At Easton Park, another Brookfield subdivision in the works in Southeast Austin, Brohn Homes, Highland Homes and Milestone Community Builders have started work on the first 175 homes. Home prices are expected to start in the mid-$200s.
When complete, the 2,200-acre Easton Park could have more than 6,000 single-family and multifamily homes, along with retail and office space and more than 300 acres of parks, open space and trails.
Eldon Rude, a local housing market consultant, said the Austin area market is strong and is expected to remain so into 2016.
But Rude, principal of 360 Real Estate Analytics, said his research shows some shifts in the market in the past 12 to 18 months, including a strong demand for more centrally located homesand a resurgence of first-time homebuyers into the market, driven largely by sharply rising apartment rents.