Housing Affordability in Austin TX

[Danny Webber]

A quick glance at housing affordability in Austin

Median Household Income App (Forbes): $73,493 ($6,124/mos)
Cost of Living (Forbes): 15% above nat'l avg

Median Home Cost (SFR-ABOR Stats): $302,250

Assume 5% Down Payment Conventional Loan- 30 year amortization
- $15,112.50 down pmt + any closing costs
• Percentage of residents with less than $1,000 saved: 56%
• https://www.gobankingrates.com/…/…/americans-savings-state/…

- $287,137.50 amt financed
- 4.375% interest rate

How the payment looks:
PI= $1,433 mos
Ins= $105 mos
Taxes= $458.33 mos (Assume $5,500/yr)
HOA= $25 mos
$2,021.3/mos PITI

DTI's
Housing ratio= app 33% @ median income ($2021/$6124)
FHA should be at 31% or less with Conv/VA/FHA being around the same although all have exceptions in place

Total DTI
These hover between high 30%’s to manually underwritten total DTI’s in the 50’s or higher depending on the programs
@ 45% Total DTI Ratio and assuming the above PITI pmt that gives a borrower approximately $734 per month in all other creditor debt (cars/cc/personal loans/etc)

These numbers are not perfect but are rather a quick illustration of current housing affordability in Austin for Retail Buyers.

Summary: Housing is becoming less and less affordable in the COA for end retail buyers

Assuming increases in property taxes/insurance/interest rates on the horizon how does this affect us as investors? What strategy/tactic changes will be needed to thrive in the future?

(excuse grammar-quick thoughts)