United States Renting Trends

UtahPlus.com, an online news information source, recently ran an article about the renting trends that are occurring in our fair land. The information in the article wasn’t so much revealing but was a confirmation of other information and reflects the trend that I have seen in the Austin area.

First the article states that 2015 should expect to see continuing demand for single family rental housing in the USA. This prediction is based on the economic factors that incomes are not rising in proportion to the rising prices of single family dwellings. This event of course takes home ownership out of the hands of many folks. Saving for the down payment of a house can be an elusive event. The report cited an interesting statistic: since 2006 renting has soared 31%! The reasons cited is that renting a single family dwelling gives the tenant the opportunity to experience residing in a house without being tied to the financial burden associated with home ownership. Well duh!

Additional statistics and information cited in the article:

1. Homeownership reached a 19 year low last year.

2. Real median household income has remained flat even though the economy is improving.

3. Families needing a place to live will turn more to renting single family homes as an alternative to buying a home.

4. Overall, there is a low supply of single family rentals and that should mean increased profits for landlords.

 

Bad News: Austin Jobless Rate Is The Lowest In 5 Years!

This was the headline for the article from todays Austin American Statesman – sounds good right? It then goes on to read that 23,700 jobs were created in Austin in 2013 – still sounds good, right? Later on we find that this rate is “only” a 2.8% increase in job creation since 2009 (and that should give us something to complain about?). I don’t think so! Austin has seen it’s lowest unemployment rate in 5 years – 4.5%, and that is an envious figure by any standard!

Here Comes Another 300!

Jobs that is – HID Global has relocated their operations from Irvine California to Austin and will create 300 new jobs. HID makes access cards to enter buildings, authentication products to secure hardware (Target should look these guys up) and they also make products that wouild allow firms to make their own ID cards. Although the was no information on the pay scale for the positions it was stated that there are plenty of jobs on the production end (lower pay range) as well as those with big pay checks. Just more good news for our booming area, and more of a reason to own Austin area real estate. These folks have to live somewhere – close to home I hope – our traffic is horrible!

Austin Makes Forbes List (Again!)

That’s right folks, Austin, as reportred in the Austin American Statesman today, writes that the Forbes list of the 25 best places to retire included Austin. The reasons for the ranking included, low crime rate, “bikeability”, the University of Texas (UT offers lectures for seniors on campus), and lower than average cost of living. Also making the list were nearby Fredricksberg, and San Angelo.

How does a salary of $135,000 Sound to You?

That will be the average salary of Athenahealthcare, Inc. a cloud based health technology outfit already with an Austin address. They are thinking of adding 35 more new jobs by the end of the year to their local base and the pay is to average a bit of $135K a year. Plans call for a total of 100 new jobs by the end of 2016, and a bunch more to come after that. It’s not a done deal, but they are strongly considing it. Stay turned for futher developments, and —- isn’t it a great time to own Austin area real estate. Rents are up, inventory down, and folks keep coming to town!

2015 Looking Ahead at the Austin Area

For us investors in Austin area residential real estate 2014 was as good as any fine wine. The harvest for 2015 is proposed to be equally as good according to those folks that make a habit and a good living by reading the tea leaves and animal entrails. A recent article in our local paper the Austin American Statesman, recently published the results of the …local fortune tellers and all looks good for us for 2015. Brian Kelsey of Civic Analytics of Austin predicts that the unemployment rate will fall from 3.9% (and this is a great number) to 3.1%. Wow! That figure represents full employment. Every time I go to a shopping plaza I see signs that positions are open. Kelsey quoted a report that stated that the area economic growth would be 4.7% in 2015 up from 3.9% in 2014. The retail sector continues to expand with retail space occupancy rate over 95% and no ease up is in sight. As I’ve stated in previous columns, a lot of retailers are following the traffic to the Austin area because of the vast number of emigrants moving here. The article also quoted Eldon Rude, a local real estate forecaster, who stated that home prices on the average increased 34% in the last four years. This is great news if you own a home but not so good news if you are a renter wanting to buy a home. This means that many renters will remain renters and that is good news for those of us owning Austin area residential rentals. Keep in mind that many of the emigrants to our area fall into the well paid millennial category who don’t want to be tied down to homeownership. Good! Just another reason why owning Austin area residential rentals is a great idea!

A Few Jobs Here-A Few Jobs There = Well More Jobs Everywhere!

Austin’s “Sparefoot” is an on-line company that lists self-storage units availability and rates, is adding 31 jobs to it’s employee base. I never knew such a service even existed! Also, this week, local advertising agency McGarrah Jesse landed the Whataburger account and will add 15 employees to handle the workload. For you out of staters, Whataburger is a San Antonio based hamburger “restaurant chain” that is very popular in these parts. The original Whataburger is still standing in Corpus Christie. They make a decent burger. Since the unemployment rate in the Austin metro area is about 4.7% I assume that the new talent will have to be imported, and then means good news for us residential real estate investors, as these folks will need housing.