Despite real estate development activity in the Austin region, many real estate experts are concerned that the recent developments aren’t enough to promise improvements in the Austin real estate market in the coming months.  Since the economic recession of 2008 began, Austin’s commercial real estate market has struggled greatly with high foreclosure and vacancy rates, and real estate experts have noted that Austin’s residential real estate is largely overpriced, which is not good given that during the current economic times, prospective homebuyers are only interested in affordable housing.  Although slight improvements may be made in the coming months, real estate experts believe that Austin real estate levels will most likely remain stable throughout 2010, with 2011 bringing about recovery.

According to the Austin American Statesman, the commercial real estate in Austin has suffered great losses since the beginning of the economic recession that began in 2008.  Commercial real estate foreclosure rates have more than doubled between 2008 and 2009, making Austin one of the worst-performing cities in Texas.  Residential real estate in Austin has also suffered from high foreclosure rates.  Real estate experts have attributed the high commercial foreclosure rates to the numerous local businesses struggling to stay afloat.  Austin also suffers from high unemployment rates, with many businesses continuing to layoff workers.  The concern for job security plays a major role in determining the success of the residential real estate market in Austin, because many prospective buyers will only invest in real estate if they are confident that they will keep their job and a steady source of income to use towards paying off the house.

The Austin Business Journal has reported that the residential real estate in Austin will also continue to suffer in the coming months if sellers aren’t willing to lower prices.  National realtors have found Austin to contain a large inventory of overpriced homes, which is surprising given that Austin tends to be one of the more affordable housing market in the nation.  However, as long as prices remain high, homes are unlikely to find buyers.  Throughout the nation, only the affordable markets are the ones showing improvements, luxury markets continue to remain sluggish.  Many homebuyers are only interested in investing in affordable or “bargain” priced homes that have been previously foreclosed on or are being drastically reduced in price out of desperation.