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RECON for July 21, 2020RECON for July 21, 20202020-07-21T05:00:00Z2020-07-21T05:00:00Z
RECON Real Estate Center
Real Estate Center research shows that price trends in most Texas metros have been relatively undisturbed by the COVID-19 pandemic. However, some markets—like Austin—have seen a disproportionate drop in lower-priced listings, and that shakeup is reflected in the metro's home price index. Keep reading for the details. (Photo from Center files.)
July 21, 2020

What’s driving Austin home price growth?

COLLEGE STATION (Real Estate Center) – ​T​​​he Real Estate Center’s latest Home Price Index (HPI) shows that price trends in most Texas Metropolitan Statistical Areas (MSAs) appear relatively undisturbed by the COVID-19 pandemic. However, Center Senior Data Analyst Joshua Roberson said looks can be deceiving.

"There is a tremendous amount of disruption across the board on the supply side in the form of fewer new listings, which can ultimately lead to fewer sales," Roberson said. "Some markets, such as Fort Worth, have had an almost uniform decline in listings at all price points. Other markets such as Austin—particularly in Travis County—have experienced a disproportionate drop in listings at the lowest price range."

Roberson said the shakeup in Austin listings may have bubbled up into the metro’s home price index. Quarterly price growth has been on the rise consistently since early 2019 up until 2Q2020.

Austin MSA Home Price Index

"This could be largely due to fewer lower-priced homes than usual," Roberson said. "The net effect has been a $45,000 increase in the median listing price for Travis County."

Digging deeper into Austin’s price tier index reveals that the bottom price tier held its ground for price growth while the middle and upper tiers experienced slower year-over-year growth. 

"The drop in lower-priced listings may tell more beyond its impact on Austin’s aggregate price growth," Roberson said. "Austin’s affordable housing supply was already limited before the virus. What is keeping these listings from coming back, and when will they return? The answer isn’t clear right now."

For the latest home price data on other Texas MSAs, visit the Center’s online Home Price Index. Monthly and housing quarterly housing reports for Austin and all Texas MSAs are also available online.
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DFW data center market has chaotic start to 2020

​​​DALLAS-FORT WORTH (CBRE) – As the COVID-19 crisis took shape, the data center industry was an early beneficiary, according to CBRE.​ North Texas was no exception.

The first quarter saw 11​.5 megawatts (MW) of net absorption across the metro as companies ramped up cloud requirements, network bandwidth, and remote computing capabilities in order to support the infrastructure required for a productive remote workforce. 

As companies scrambled to respond to COVID-19, leasing activity slowed significantly in 2Q2020, which saw only 2.98 MW of net absorption. 

However, with a number of large requirements currently in the market, it is likely that there will be some improvement in leasing velocity over the second half of this year. 

Local vacancy decreased in the first half of 2020 from 19.2 percent to 17.6 percent, the lowest vacancy in the market since 2018. Construction also slowed to 15 MW of projects underway. 

Dallas is well positioned as one of the lowest-cost markets in the world for Class A data center space. 

CBRE expects the sector to continue to benefit from increased demand. ​
Monthly Review of the Texas Economy
Read our latest Monthly Review of the Texas Economy report for more. 

Two Texas cities among college towns most vulnerable during pandemic

NEW YORK (SmartAsset) –​ Two Texas cities have landed on SmartAsset's list of the most vulnerable college towns during the COVID-19​ pandemic.

College Station,​ home to Texas A&M University, ranked second. More than 44 percent of the Brazos County city's population are college students, the second-highest in the study. ​The city's economy relies heavily​ on food service, and the area has the 12th-highest concentration of restaurants and bars at 9.27 percent. 

San Marcos ranked ninth overall. The city​​, home to Texas State University,​ has the fourth-highest student population relative to the city’s population, 23rd-highest concentration of entertainment establishments, 13th-highest concentration of bookstores, and 18th-highest concentration of hotels.​ ​​

Other cities on the list are:
  • No. 1 Blooming, Ind., Indiana University Bloomington;
  • No. 3 Champaign, Ill., University of Illinois at Urbana-Champaign;
  • No. 4 Athens, Ga., University of Georgia;
  • No. 5 Flagstaff, Ariz., Northern Arizona University;
  • No. 6 Davis, Calif., University of California, Davis;
  • No. 7 Ann Arbor, Mich.,​ University of Michigan;
  • No. 8 Chapel Hill, N.C., University of North Carolina at Chapel Hill;
  • No. 10 (tie) Ames, Iowa, Iowa State University; and 
  • No. 10 (tie) Auburn, Ala., Auburn University. 
To determine the rankings, SmartAsset compared 95 college towns with populations of 50,000 or more. The study looked at students as a percentage of the population, college staff as a percentage of workers, and concentration of restaurants and​ bars, entertainment establishments, bookstores, and hotels. 
From Abilene to Wichita Falls, the Real Estate Center has reliable housing data for your area. Our latest monthly and quarterly housing reports are now online. (Houston-area reports and data will be released in August.)

Homebuilding picks up at Sun Chase

AUSTIN (Austin Business Journal) – Qualico CR LP is adding 225 homes to Sun Chase, a 1,604-acre master-planned community three miles east of the Circuit of The Americas racetrac​k and SH 130. 

Lennar started building homes in the project in mid-2018. Gehan Homes was added as a second builder and will begin construction in the next couple of months.

At buildout, four-phase project will include:
  • 4,026 single-family homes, duplexes, condos, and townhouses;
  • 2,400 apartment units;
  • 77 acres of commercial space;
  • 66 acres for schools and a fire station; and 
  • 600 acres of greenbelt and open space. 
Lennar, Gehan, and an unnamed third homebuilder will build phase two of the development in mid-2021.
Sketchy drawing of commercial buildingsThe Real Estate Center's Texas Quarterly Commercial Report looks at past, present, and future commercial real estate activity in the state's four major metropolitan areas. It covers the office, retail, and warehouse sectors. Read and download the report for free, and subscribe to know when the next issue is published. 

NRP breaks ground on four affordable apartments

​​​​​​​CLEVELAND (MultiHousing News) – The NRP Group has broken ground on four affordable apartment projects across Texas totaling 922 units.

Three of the developments are in San Antonio. They are the:
  • 324-unit The Arcadian at 4611 E. Loop 1604 N.;
  • 324-unit Scott at Medio Creek at 9130 Excellence Dr.; and 
  • 69-unit Luna Flats at 510 Alametos St. 
The fourth project is the 205-unit Independence at Collin McKinney at 2150 Collin McKinney Pkwy. in McKinney. 
NewsTalk Texas logoHungry for more Texas real estate news? Then feast your eyes on NewsTalk Texas, our online news database. Here are a few of the stories you'll find there this week: NewsTalk Texas is updated each weekday, throughout the day. 

Austin retail sector feels effects of pandemic in 2Q2020

AUSTIN (CBRE) – Local retail fundamentals began declining last quarter due to effects of COVID-19 on the local economy.

According to CBRE, absorption continued falling in 2Q2020, registering negative 627,511 sf. 

Occupancy declined 80 bps over the quarter to 95.2 percent. Average asking rate also fell to $20.50 per sf. 

Despite sliding market fundamentals, development activity remained strong. There are 48 projects totaling 1.3 million sf in the construction pipeline. Last quarter, 97,776 sf came online.
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New York REIT buys Stanley Black & Decker distribution center

​​NORTHLAKE (Dallas Business Journal) – New York City-based REIT Lexington Realty Trust has purchased Stanley Black & Decker's Al​​​liance Texas distribution center for $83.5 million.

The 1.2 million-sf building at 8601 E. Sam Lee Lane was sold by developer Hillw​ood. The sale closed in February. 

Stanley Black & Decker moved into the facility in 2019.​
Communication Matters video seriesThe Real Estate Center's Texas Home Price Index measures price appreciation changes for residential single-family homes. It provides data for eight different Texas metros across three different price ranges.

New apartment tower coming to Houston skyline

​​​​​​​​HOUSTON (REBusiness Online) – High Street Residential, a subsidiary of Trammel Crow, has broken ground on a 43-story apartment tower downtown.

The 309-unit community at 808 Crawford St. will include one-, two- and three-bedroom apartments, 16 two-story townhomes, and four two-story penthouses.

Amenities will include a rooftop pool with lounge, clubroom with catering kitchen, business center with coworking space, fitness center, yoga terrace, indoor pet spa, coffee bar, and package services​​​.

Completion is slated for late 2022. 

Work starts at Amazon distribution center in El Paso

​​​EL PASO (El Paso Times) – Layton Construction Co. has broken ground on an Amazon fulfilment center near Eastlake Blvd between Rojas Dr. and I-10. 

The five-story building will sit on 115 acres and have more than three million sf of space. 
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Material herein is published according to the fair-use doctrine of U.S. copyright laws related to non-profit, educational institutions. Items attributed to sources other than the Real Estate Center at Texas A&M University should not be reprinted without permission of the original source. To send news items for consideration, e-mail Hayley Rieder. The Real Estate Center is part of Mays Business School at Texas A&M University in College Station - the heart of the Research Valley.

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