Suburbs lead the way in Austin region’s growth

Austin has long been the poster child for explosive growth, but new Census Bureau data released Thursday signals that the city’s growth rate is starting to mellow out as its surrounding suburbs boom.

Austin added more than 20,000 people each year from 2011 to 2015, but the new data shows that it added only 17,738 in the most recent year — a gain of 1.9 percent, its smallest increase in six years. And the city’s share of the greater metro area’s growth, 30 percent in 2016 compared with 43 percent in 2011, also made up the smallest portion in six years.


At the same time, suburban Central Texas towns like Georgetown, Cedar Park, Round Rock and Pflugerville were among the nation’s 25 fastest-growing cities with 50,000 people or more. The Houston suburb of Conroe topped the list, followed by Dallas-Fort Worth suburbs Frisco and McKinney.

Hays County, whose cities, especially San Marcos, were once the yearly chart-toppers among fastest-growing cities, also saw increases in growth, though not quite as dramatically.

“We are experiencing a level of urban sprawl that I think may be unprecedented for Central Texas,” Austin demographer Ryan Robinson said. “This, to me, supports the overall narrative that we are maturing as an urban region, and part of that maturation process means that the city of Austin is becoming a less significant piece of the whole.”

In the horse race among cities with more than 500,000 people, Austin was No. 1 or No. 2 in annual growth from 2011 to 2014, but in the past two years, it has been surpassed by Fort Worth, Denver and Seattle.

One major driver for Austin’s sprawl is the rising cost of housing in the city as compared with the suburbs as well as a post-recession return of big, national suburban home building, Robinson said.

While Austin might not be the one breaking records anymore, it’s still the catalyst for growth in surrounding areas, Robinson said.

“Central Texas grows because of the vibrancy — economically, culturally, socially — that is still mainly emanating from the city of Austin,” Robinson said. “So it’s still the city of Austin that’s making the region grow, but our share of that total growth is less and less with each year.”

Suburbs gaining steam

That was the case for Evelyn Vasquez and her husband, Eddie, who moved to Pflugerville from New Mexico in April after Eddie, an engineer, got a job at Samsung in North Austin.

The couple made their home in Pflugerville, which ranked this year as the 25th fastest-growing city over 50,000. They were drawn by its small-town feel as well as housing availability and affordability, Evelyn Vasquez said.

“There was a new house that was ready to move into. It was ready to go,” she said. “When we came out to house hunt, we agreed that it was a good area.”

Similarly, Georgetown, which fell to No. 5 from its top rank last year as fastest-growing U.S. city above 50,000, is still seeing a large influx with an added 3,501 people, or 5.5 percent growth, in 2016.

Real estate broker Carol Fahnestock, who owns 29 West Realty Group, pointed to a large stack of papers she had in a binder Wednesday from people interested in moving to Georgetown.

Fahnestock’s customers — many of them coming from the San Francisco area — tell her they like feeling close to Austin but being in a more laid-back town that is less expensive and has less traffic, she said.

“A house that we sell here for $400,000 to $500,000 would be triple that in California,” she said.

Proximity to Austin, San Antonio and Houston — all of which ranked among the top 10 U.S. cities in terms of number of people added — also helps drive the growth in Bastrop County, said Shawn Kirkpatrick, the Bastrop Economic Development Corporation executive director.

“Companies looking for a convenient location within the triangle between Austin, San Antonio and Houston as well as access to Austin-Bergstrom airport and a talented workforce are inquiring about locating here,” Kirkpatrick said.

Growing out, not up 

That metro areas are growing more suburban mirrors a national trend. In a recent New York Times report, “Seattle Climbs but Austin Sprawls: The Myth of the Return to Cities,” economist Jed Kolko describes this phenomenon.

The exception to the trend are dense metros such as Seattle or New York, which were denser to begin with and tend to grow up instead of out, Kolko said. That explains why Seattle (3 percent increase) leapfrogged Austin (1.9 percent increase) in rate of growth last year.

Kolko’s analysis found that of America’s large metro areas that have sprawled, San Antonio and Austin spread out the most. Echoing Robinson, Kolko said that’s in large part due to the comparative higher cost of housing that has pushed people out to the suburbs.

“While it’s a national trend that urban home prices are rising faster than suburban home prices, that’s especially true for Austin,” Kolko said, who defines “urban” as higher density areas and “suburban” as lower density areas.

The new census numbers come after the median price of homes in Central Texas hit $305,000 — the second-highest level ever, according to the Austin Board of Realtors.

Home sales were up 8.6 percent year-over-year in Williamson County and 3.3 percent in Hays County. Travis County, where home prices tend to be more expensive, saw a 2.1 percent decline.

Even as Lakeway’s schools draw more residents, its businesses are struggling to fill lower-paid positions, Lake Travis Chamber of Commerce President Laura Mitchell said.

“What we’re seeing is in the service industry there’s a shortage of hourly employees,” Mitchell said. “We’re working with city officials to address this issue. But we don’t have public transportation here, and there’s not as much affordable living. It’s a multitude of things.”

Single-family home prices remain most affordable in Williamson and Hays counties, but that’s also where home prices are rising the fastest, the Austin Board of Realtors said.

And Robinson predicted that’s not likely to let up any time soon.

“All of that culminates in my mind in a recipe for a hyper-level of sprawl over the next few years,” Robinson said. “So we’re back into a ‘drive until you qualify’ mode.”

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