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DAB STATS – June Transaction Summary

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In June we made local real estate history.

1) We observed the most expensive (per foot) recorded transaction ever in downtown Austin: the 43rd floor 2bd/2ba 2022ft penthouse at 360 Condos, once owned by the building’s developer, sold for $717psf.  Note, this sets the record for a recorded transaction in downtown, that is auditable via the MLS.  We’re familiar with the off-record purchase of the 11,000ft penthouse at the Four Season Residences for more than ~$1,000 per square foot.

2) The Austonian posted in June a 3bd/3ba 45th floor unit for sale @ $1120psf.  This is the most expensive (per foot) unit ever listed in the MLS area “DT”.  Mind you, the 45th floor is well below the penthouse.

3) The Austonian and Four Seasons now have residents, and each building has closed more than a dozen units, with more in queue.  These transactions are not reflected in the summary data below.

The transactions in aggregate show year-to-year growth for the month of June from 13 to 17 transactions, selling at an average of $296psf to the current $321psf, respectively.  Compared to last month, prices are up from May’s average of $284psf.  As always these numbers require qualification.  Prices did not surge 13% from last month as the raw data would indicate.

In May, nearly 25% of the transactions occurred in buildings outside of the downtown core (Cambridge Tower, Penthouse, Greenwood Tower).  These buildings can generally trade $100psf less than the average, so when there is an abnormal number represented in “DT” sales, it brings the averages down.  In June, there were only two of these transactions.

I’m increasingly using a modified version of the DT boundary that brings the boundary south from MLK to 15th Street, as this better represents the core, but I will always indicate this to you when doing so.

Registered members of DAB can download a complete statistical and transaction detail report here.

-Jude

DAB STATS – May Transaction Summary

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WHEW…

In May, we saw at least four articles suggesting that more downtown Austin buildings are forthcoming: Block 51, Austin Energy building on West Ave, City planning a new parking garage, State capitol considering more density.  We haven’t seen that many speculative media reports about downtown development since 2006.

We’ve been hammering the point that there is no more new inventory under $400 per foot.  It’s gone.  But, don’t get caught up in the hype about new construction, at least not yet.  Even if the data suggests that there is capacity for more new attainably priced product (2bds/2ba+ for under $400k), the capital markets aren’t racing to provide financing.

Conversely, there’s a robust resale market working like a well oiled machine.  The difference between average asking price and average sale price is shrinking.  Last month, across 22 transactions, this spread was ~4%.  Timid buyers and sellers should take confidence in this stability.  To drive home the point even further, we witnessed at least two bidding wars last month.  Many buyers are longing for the days of 2008 and 2009 when 25-30% discounts were being offered.

Area “DT” – MLS defined market area for downtown Austin – has such diverse product that average numbers cannot be used without qualification.   For instance, it is necessary to qualify the age, location, and level of amenities when comparing Cambridge Tower to 360 Condos. ($226psf vs. $385psf, respectively)

Average price for area DT was $283.91 per foot, based on data collected from 22 transactions recorded in May.  That is down from May of 2009 when pricing was $303 per foot across 13 transactions; however, the spread between list price and sale price in 2009 was closer to 10% – much more volatile.

The MLS data does not include private developer sales (Spring, Austonian, W Hotel, Four Seasons).  Multiple sources have shared with us that the W entered into approximately 10 deals in May, and will not accept offers with more than a 5% discount.   The Austonian recieved their certificate of occupancy and is planning it’s first closing next week.  No news from the Four Seasons.

Registered DAB subscribers may access the complete May 2010 transaction report.

-Jude

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Link Round Up

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  1. Facebook moves into their downtown Austin offices at 300 W 6th Street, on Monday.  This building has 22 stories, built in 2002, and is pretty nice looking, though I never know what to call it.  It’s between Lavaca and Guadalupe, across from Belmont.  It will now be called the Facebook Building.  (ABJ)
  2. The site at 2nd and Congress, where that 1000 room hotel was to be built, still could end up with a hotel, just a different hotel, but right now they are just planning for a hotel.  Oh well.  (Statesman)
  3. If you didn’t catch it yesterday, the I35 Makeover is official, funded, and soon to be under construction. (DAB)
  4. Michael Barnes shares the A-List hotel bars in Austin.  Driskill #1, Four Seasons, #2.  I would agree with those for downtown.  Overlooked was the Finn & Porter lounge at the Hilton –  the upstairs lounge has an easy going and chilled out vibe.  (Austin360)

Latest From Downtown Austin Facts

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What’s it like to be a single mom, or a married couple in downtown Austin? Take a listen…


The audio links above represent the latest radio spots from DowntownAustinFacts.com (link).  I still feel compelled to qualify their proclamation that there are only 400 condos remaining.  From one perspective, that number is insufficient to describe the number of units available for purchase.  From another perspective, that number paints an overly rosy picture of what’s available to the average buyer. To elaborate further:

First, this number (400) represents new construction and doesn’t include the approximately 175 resales that are on the market.

Second, this number represents the inventory at four buildings: the Austonian, Block 21 Residences (aka W Hotel Residences), Residences on Town Lake (aka Four Seasons Residences), and Spring condos.

Third, how many new “attainably” priced units are available?  Nearly ZERO – ok, there are five units at Sabine and two units at the Shore condos.

Let’s get this out of the way for the trolling skeptics… DowntownAustinFacts.com is a website sponsored by a consortium of builders.   That fact doesn’t change the reality that downtown Austin is facing a shortage of condos for sale over the next 5-10 years, especially priced in the 200-400k range.  THE INVENTORY IS LOCKED IN.  You will not see any new projects come out of the ground until at least 2013, perhaps longer.

-Jude

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