Austin’s Real Estate Dilemma: Why Buying Real Estate in Austin, TX Has Become Nearly Impossible Unless…

Why It’s Becoming a Challenge for First-Time Buyers

In recent years, the process for first time buyers looked like this: Very straightforward.

First, get approved for a loan. 

Secondly, decide if you’d like to offer on resale homes, new construction – to be built, or new construction – already constructed.

Thirdly, make your offer.

Resale sellers were fielding zero to one or two offers and willing to accept listing price terms from qualified buyers using loans. They weren’t seeing many full price cash offers. They were renegotiating sales price terms if appraisals were coming in less than asking price in our slightly increasing market.

Now, there is as little available for resale as we’ve ever seen (see graph below). Buyers are having to increase their offers significantly above list price. They are needing to increase their downpayment amounts to compete with cash-heavy out-of-state buyers. Buyers are having to waive their right to terminate the contract if appraisals are falling short in this new rapidly price-increasing market.

Almost all new construction communities were allowing buyers to enter into contracts on homes to be built in the future with relative ease. 

Now buyers are jumping on the bottoms of waitlists with dozens of other buyers just hoping to land a future lot. Or they are entering the lot-bidding lottery…where lots are released 5-7 at a time and buyers throw highest and best offers, just to secure the lot. 

Completed new construction inventory was a way for buyers to walk into brand new homes, tour their eventual home on the spot and make their offer.

Now, zero, if any, completed new construction inventory even exists at this time.

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Bonalife Homes’ Agent Aaron Washington poses with first-time home buyers, January 2021.

Why It’s Becoming a Challenge for Move-Up Buyers Needing to Sell First

Buyers looking to sell their property and move up into other resale inventory was an easy transaction. We’d list their home first, find their buyer, all while helping them choose their next home to time up closing dates without much issue at all.

Now resale homeowners have so much leverage, they are choosing to work with buyers mentioned above who aren’t contingent upon selling a property, instead of buyers who will be needing to sell to procure bank financing.

Move-up buyers were able to go under contract on new construction that was to-be-completed, even with a property needing to be sold. Before construction completion, they would pick out a lot, start the building process, and sell their home as construction completion nears.

Now, many builders are no longer choosing to enter contracts with contingent move-up buyers needing to sell another property until partial construction completion has occurred – and often by that time, another non-contingent buyer has already scooped up the property.

And just like first-time buyers, move up buyers are struggling to find completed new construction anywhere as they’ve all been scooped up.

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Bonalife Homes’ Agent Bernaddette Schepperly poses with first-time home buyers, December 2020.

This might have you wondering – how the heck do we move then?

Keep reading…

Best Case Scenarios:

  1. Cash Buyer – why wait for financing to finalize as a seller if you can sell it to someone for cash and remove the appraisal and third party financing from the situation? Having cash is the most likely way to secure the property you want. 
  1. Financing Non-Contingent Upon the Sale of Property – if possible, selling first for top dollar, spending time in temporary space (short term rental, stay with family) and then making your purchase could remove the sale contingency from your offer.
  1. Take Advantage of Your Realtor Relationship – with the right Realtor in place, you should 
  • be able to learn about sell-before-buy cash programs
  • be able to leverage their builder relationships to get to the front of new construction opportunity before others
  • be able to leverage their realtor relationships to gain access to resale inventory before other buyers
  • be able to structure your offers terms competitively to stand out in a crowded market of buyers making offers.
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Testimonials provided by clients who have sold their home with Bonalife Homes recently.

Every situation is different.

Set a time to talk with our team HERE about your specifics and let’s build the ideal plan for your family.

Things To Do in Austin, Texas

Are you new to town? Been here for a while? Just visiting? As one of the fastest growing cities in the United States, there are many reasons why everyone is moving to Austin. Here are some tips and facts about the different areas and things to do in Austin and Central Texas!

North Austin

In North Austin, you’ll find great family-friendly neighborhoods including Brentwood, Allandale, Rosedale, with neighboring towns Round Rock, Pflugerville and Cedar Park. With many places nearby, here are some recommendations.

The DomainYou’ll find over a hundred high-end boutiques as well as more traditional retailers such as Macy’s, Nordstrom, Bath & Bodyworks and luxury brands such a Coach, Burberry, Louis Vuitton including much more. Oh, and don’t forget restaurants that feature Austin’s flair!

Photo courtesy of The Domain

Typhoon TexasGet out of the summer heat at one of the only waterparks in Central Texas. Located in Pflugervile, Typhoon Texas covers nearly 25 acres, which means there’s plenty of space for you and your family to splash around!

Photo courtesy of The Houston Chronicle

Wild West “Out in the country past the city limit sign…” is an 11,000 square-foot honky-tonk for you to get your country dancin’ on! This entertainment space features live music from notable local artists and is adults only – what a perfect date night!

Photo courtesy of Yelp

South Austin

A culture of its own, South Austin has many things to offer for the outdoor adventurer! It’s a bit more quiet compared to other neighborhoods in Austin, but it’s one of the more diverse areas in town. The neighboring areas of Buda, Hays and Kyle are also known for their great school districts.

Circuit of the Americas30 minutes from the heart of downtown lies the famous Formula 1 racing track and MASSIVE concert arena! Circuit of the Americas is home to the Formula One United States Grand Prix, the IndyCar Classic, and the Motorcycle Grand Prix of the Americas, and a round of the FIM Road Racing World Championship. With many events throughout the year, there are plenty of things to do here!

Photo courtesy of Circuit of the Americas

Mavericks Dance Hall Similar to Wild West in North Austin, Mavericks Dance Hall in Buda offers some of the best country dancing in town. What sets Mavericks apart through is their infamous theme nights: Tejano Night and College Night. They even offer dance lessons, so don’t worry if you’re new to town!

Photo courtesy of YouTube

McKinney FallsLess than 15 miles from the state’s capital, you can get the full state park experience! McKinney Falls includes tons of hiking trails to make it an all-day trip. You can visit for the day or you can stay overnight at one of their 80+ campsites. Unplug from the busy city life and unwind with nature!

Photo courtesy of A Taste of Koko

Central Austin

In the heart of the state’s capital, you will find endless opportunities in all areas of life. There are dozens of high-rise residential condominiums, apartments and corporate global offices for Indeed and Google. 

Downtown – From the beginning, Austin was designed to be a “government town” which makes the downtown area very unique. The streets are numbered West to East, and named after Texas rivers from North to South, making it very easy to get around even if you’re new! Downtown offers a variety of nightlife in the form of bar districts, concert venues, and coffee shops just to name a few. 

Downtown Austin during Pecan Street Festival | Photo:Will Taylor

BBQ Moving to Texas from the North? BBQ should be added to your to-do list! When it comes to visiting Austin, you can’t fully leave town without trying some true barbecue. Here’s a few places to try out: Franklin’s, Terry Black’s, Stubb’s and Salt Lick!

Photo courtesy of VXLA

Zilker Park Home to the Austin City Limits Music Festival every October, Zilker is open year-round for families and individuals to enjoy various outdoor activities such as family picnics and swimming. Zilker also offers other free events throughout the year like Shakespeare in the Park and Blues on the Green.

Photo courtesy of Wikipedia

West Austin

West of MOPAC Expressway, you’ll see where Texas Hill Country and the City blend together. One of the best things about Austin is how nature is at the edge of your fingertips on this side of town.

Barton Creek Greenbelt – It’s crazy how so much greenery and nature views can be located MINUTES from Downtown Austin. Although there are multiple greenbelts in Austin, this one is the most popular one! This area spans 12.68 miles of gorgeous trails, with the main trail being about 7 miles. The Barton Creek Greenbelt is considered one of the top hiking trails in Texas!

Photo courtesy of Do512Family

Lake TravisWhether it’s on a party boat or a jet ski, Lake Travis is home to endless water adventures. Fill up your cooler, get sunburnt, and then have dinner on a cliff 400+ feet above the lake at The Oasis!

Photo courtesy of laketravis.com

Omni Barton Creek Resort and Spa – If camping isn’t your thing, you can still have your stay-cation at the Omni Resort and Spa nestled in the hills of Bee Caves. With ten tennis courts, infinity pools, and an 13,000 square foot spa, relax your worries away!

Photo courtesy of Omni Hotel & Resorts

East Austin

East of I-35, you’ll find yourself in the “fastest growing neighborhood of Austin”. A center for the more artistic side of Austin, you’ll find art galleries for all ages and a few other activities to fill in the gaps.

The Thinkery Founded in the early 1980’s by a group of parents, The Thinkery is designed to enrich kids and their families with hands-on experiences. Open to “learners of all ages”, their mission is to equip and inspire the next generation of creative problem solvers. This sounds like a great learning day for the whole family!

Photo courtesy of Austin Chronicle

Blue Starlite Mini Urban Drive-In – Especially during COVID-19, Drive-In Theaters have been making a huge comeback. Whether it’s with friends or family, you can feel like you’re in a 1950’s movie all within the comfort of your own car. Finally, a theater you can sneak snacks into!

Photo courtesy of Austin Chronicle

East Austin Studio Tour – Spanning two weekends in November every year, the EAST allows for local Austinites and out-of-towners to tour the creative spaces of Austin. You can take a tour and get to know the friendly faces behind the artwork behind your favorite coffee shops.

Photo courtesy of News Break