Prices will continue to rise as quality rises
Charlotte Lipscomb, a Realtor on the board of directors for the Austin Board of Realtors, said she has noticed the inventory in the Lake Travis-Westlake market requires a “more sophisticated buyer with appreciation for quality architecture and finishes.”
She said people are willing to pay for high quality and that it has been interesting, as a Realtor, to watch that trend continue to rise.
“I think you see a change about every five years,” Lipscomb said. “People are so thoughtful now about floor plans. Even if it’s not an expensive property they want to be thoughtful and creative.” She said recently, some buyers are leaning toward smaller, extremely-well designed and high-quality houses. Strub said that with prices trending upward so quickly, adjustable-rate mortgages are becoming popular again. Adjustable-rate mortgages are a way to manage high prices and make those homes more attainable, Strub said.
“In just the past six to nine months I’ve seen several clients go in that direction, which has been interesting” he said. “They’re managing affordability, which is a funny word to use in Westlake.”
Lake Travis sees construction; Westlake renovation
Since Rollingwood and West Lake Hills are essentially built out, most of the new construction – and all the giant, brand new subdivisions with hundreds and sometimes a thousand new homes – are being built in the Lake Travis area, including Lakeway, Bee Cave and Spicewood.
“My sense is that we still have a demand for housing,” Lipscomb said. “We have a great influx of people. No one has a crystal ball, but I think we do need even more inventory. People love new construction, and so it’s reasonable to expect new construction to keep going in those [Lake Travis] areas.”
When it comes to purchasing homes that are already built, potential homeowners are seeking renovated, up-to-date homes, Jones said.
“It’s different for Westlake than Lake Travis,” she said. “For Westlake, the inventory is just so limited, the trend is buyers purchasing homes that people have updated to a modern style.”
Jones has noticed renovated homes selling faster than “a traditional Westlake home that still needs updating.”
She said lately buyers want a move-in-ready product, even in Westlake where there is a more limited supply.
“But in Lake Travis, we have more construction and buyers are trending more toward neighborhoods that offer new homes and resort-style amenities, along with boating, hiking and recreational things in the area,” she said.
There are a few older homes built in the 1970s and '80s in Lakeway that have lower price points of about $300,000 to $400,000 that people sometimes purchase and fix up, Jones said.
“But existing Westlake real estate is already starting at a higher price point, most starting at $700,000 and going up from there,” she said. “So I feel like for that price, buyers are wanting things move-in-ready. At $1 million to $1.5 million, the ones that need work sit on the market longer.”
Newcomers continue to move to the area
A huge part of Strub’s business and day-to-day work is relocating out-of-city and out-state-families.
“One out of four, or 25 percent, of buyers we represent [at Strub Residential] are brand-new to Austin,” he said. “What we’ve seen just in the last year or two is that people come here chasing the idea that this is an inexpensive city to live in, and then they get here and are shocked at how expensive it is.”
Strub said he foresees outside buyers continuing to come to the area, resulting in large homes continuing to be built in Lake Travis and prices in Westlake continuing to drive up.
Jones agreed that a lot of the buyers in the Lake Travis-Westlake area are coming from out of state, and that those who are not from Central Texas are drawn to EISD and LTISD when deciding where in the Austin area they want to live.
“We’ve also been seeing a trend of moving to Texas in general,” she said. “Because even though property taxes are still a factor, it’s a great state tax wise.”
But many home sales are also coming from “move-up” buyers, Jones added.
“Those are people who want to stay in the same area but are ready for a bigger home,” she said. “That’s a sign of a good economy.”
Lipscomb said as more residences are built, more day-to-day conveniences – such as medical offices, stores, restaurants and services – are also added to the area, which then further draws people in and perpetuates the demand.