Sunday, February 17, 2013

How Much Does Real Estate Land Cost in Austin?

Many people moving into our area from other parts of the country begin their search with one simple idea: "We really want a house with some land. Maybe an acre or two." Sometimes families are looking for more than a few acres to spread out. Sometimes people are just wanting to be a little further out of the city. That's outstanding! We do have properties with acreage  in Greater Austin. But this land comes with a simple provision--land is not cheap here in the Austin area. In fact, many people are surprised at the actual cost of dirt, especially as you get closer and closer to the downtown area. And you don't have to be south of 2222 to see how much the price of dirt drives the price of Real Estate. 

So, what does land cost in the Austin area? Well, if you draw concentric circles around downtown Austin and extend those circles out to the edges of what we know as "Greater Austin" today, you will discover that the cost of dirt near downtown starts around an effective average cost of somewhere in ballpark of $1.5M an acre. That's not to say that you could find and buy an acre of land in or near the downtown area, it is just a gross estimate of how much you might be paying for a piece of a lot when you buy near downtown.

As you move away from downtown Austin, the price of land drops--gradually. You can see the price drop every few blocks near the downtown area and as you get closer and closer to the outskirts of Austin, prices fall to betweem $100-500k per acre--inside Austin. As you get into the extended-burbs of Greater Austin land may begin to fall under $100-200k per acre. When you get out into the far reaches of the area that we call Greater Austin where you can still find some small farms and Ranchettes, you may find undeveloped land for as little as maybe $15-20k per acre. Keep in mind, these lots could be more than an hour's drive to Austin and many of these lots may be completely undeveloped--so you will still have to pay for utilities, septic, drive ways, etc. So, the effective cost of an acre of land really ends up being much more than $20,000--even in these communities that sit on the otter edges of the Greater Austin area. And yes, there are exceptions to these rules of thumb. There always are--but exceptions come with their trade-offs of location and market value.

Every region and community in Greater Austin is different. The free market reigns in Austin Real Estate--there are no easy rules that say you will pay $1M an acre within a mile of 6th Street or $500,000 an acre to live in Steiner Ranch. No. Every community has unique value propositions and every area of Austin stands alone at any given point in time. The bottom line is--you always pay for what you get in Austin Real Estate. Don't be confused--not everyone gets what they pay for--but you do pay for what you get in Austin Real Estate. 

If you are looking for a new home in the Greater Austin area--give me a call. Let's Talk.

Tim Thornton

1 comment:

  1. I think its not as much expensive as the market rate in any other state.

    ReplyDelete

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