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Wednesday, April 09, 2008


Scott Hurst

Although the mortgage rates are low and there is a surplus of inventory, with the stringent rules being implemented through-out the mortgage company arena, yes, its tough to get loans. However, this does not mean you cannot get a loan. There are still plenty of second market loan programs out there.

Ben Bernanke is certainly not the answer to our prayers, and government babysitting our loan market isn't helping -- keep in mind that we are in a day and age of interjection. The government likes to stick its hands in places it shouldn't, so whats this mean to you? Your probably going to be safe to get those loans, because the government will assure that this market is spoon-fed.


I'd say none of the projects you mentioned is really close to your definition of afordable housing (RV park doesn't count since it is targeted at the homeless). Mueller does have 2 David Weekly homes which would fall into the affordable category, but you must earn ~85% of median income to qualify (median is ~48k, thus ~41k max income for these affordable units which are in the 160k's). For these 85% median families, they really should have 20% down to make the payments affordable, if not they are probably putting too much gross income towards housing. There are also row houses in Mueller, but these are really just condos and are in the 120-140ks if I recall correctly.

Also, take a quick look at the median house price of 186k vs the median income of 48k - it is still workable, but only if the buyers have some skin in the game. 20% down certainly makes the numbers work, but most buyers can't/don't save that much for a down payment.

As far as density, well we have tons of downtown condo units coming online in the next few years. I believe the current projections show only 50% uptake of these units given current demand. Unless things change, this may help our density - excessive supply will drive prices down and more people will consider a downtown condo.

Dee Copeland

Thanks for the comment! We were looking at solutions for low income, working class, as well as homeless.

I'd mentioned that Mueller, the average home is $350k, but if you think about the location and the fact that the homes are 2500-3000sqft for that price, it's affordable for Central Austin.

I was actually looking at the need for more new urbanist communities, which will often have an affordability component. Same thing for the other solutions. My thought was that the city is pouring tax subsidies into expensive condo and mixed-use projects like the Domain and 2nd Street District, but I'd rather see a focus towards mixed-income solutions.

I like the idea of the garden homes or some level of a co-housing solution.


I agree that more new urbanism is a major key to affordability, simply because of the increase in supply. And that means infill in the existing neighborhoods, not just downtown. I'm looking at you, ANC NIMBYs.

However, I think you need to add middle class families to your group of people who need affordable housing. (See "the gap" at Mueller.) 180k is a real stretch for families with kids making the median income. If the kids are in day care so both parents can work, forget about it. (Or at least forget about them also saving for retirement and college and doing the other things they are "supposed" to do.)

Upper-middle incomes and middle-incomes are not remotely the same thing since both families are stuck with the same set costs on a lot of items - transport, food, child care. One group scrapes by, the other has discretionary income.


I'm having a hard time not laughing my ass off at the "creative, viable solutions" for lower income earners. Are you on crack? 350k is affordable? Even 250k is not really in reach of most lower income families. Why would lower income people care about New Urbanism? It's smells of elitism, something the folks at Dwell magazine would dream up. If this is where affordablity starts in Austin we've got real problems.

Dee Copeland

Ranch 11, Mueller Austin has 25% of the homes in the below 80% Median Family Income (AMFI) range. That's $120-140k or so.

The entire development is not an affordable housing development. It's a new urbanist community, meeting it reaches all levels of income. The problem was that most homes are selling in the 300s, so they're also looking at solutions for "the rest off us", which (for Austin) is in the $160-250k range.

Affordable here is the high 100s and low 200s. If you're talking "low income", that's below $140k or so, which the Mueller Community is serving.

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