Upgrading a 1970’s Vintage Home

Jennifer and Tony Latto, and their two girls, have a 1970’s vintage home in a very nice neighborhood of Austin.  Jennifer, who is a registered architect and interior designer, has made some interesting updates to their home. 

 

Roselind: 

Jennifer, first of all, thanks for sharing your ideas on the ongoing remodel of your home.  What have you done so far that has made a difference? 

 

Jennifer: 

We arrived from Boston just over two years ago and moved into a 70s home in Bee Cave Woods.  We loved the open floor plan, the private yard, the existing trees, and the location.  The home was smaller than those we’ve had in the past but we recognized the potential!   

 

We tackled items that were relatively inexpensive first, just to get the house to where it felt like “ours.”  Since I earn a living improving environments, I have a hard time staring at the ordinary or run down!  This trait drives my husband crazy because I constantly want to make upgrades! 

 

Most of the work we have achieved thus far was outside; however, one of the biggest impacts was to reface the stone fireplace with gradient glass tile on the vertical surface and a quartzite slab hearth to match the kitchen.  This is a focal point for our living area and always extracts comments!  I’ve included a photo (even though we have yet to grout it!).

 

 

Roselind: 

I’m glad to hear that you are like most folks – remodeling is something that does not get done all at once.  It can go on for years – and that is OK.  Shaping a home takes time. 

 

Tell me a little more about gradient glass tile.  I can see that is goes from a more intense color at the bottom to a lighter shade.  Where did you find this tile?  And, quartzite slab?  What is it, and where do you find it? 

 

Jennifer: 

This is our fourth home remodel in ten years.  We’re a bit tired but there’s still always a project around here and we attack them when finances and schedules allow!  It’s really a lifestyle!

 

There may be other resources for this but the tile on our fireplace is from Hakatai, www.hakatai.com.  I loved their program for customizing the blend from their glass tiles.  You can select the tile colors used.  By adding the same color twice, the intensity of that color is increased.  A minimum of two colors is required but a maximum of ten can be used.  Their custom design tool will allow you to preview the design and it generates a price.  The same tools are available for a custom “blend” which are popular for kitchen backsplashes and bathrooms.

 

The slab is quartzite, which is a man-made material composed of about 90% quartz combined with pigments and polymer resins. It is stain, scratch, and heat resistant and doesn’t require sealing like natural stone.  It can cost just as much, or more, than granite and marble but I love the modern monolithic look and you can’t beat the durability.  Vivid colors are also more readily available than in natural stone as well.   CaesarStone and Silestone are two brand names. 

 

 

Roselind:

Your backyard is amazing!  I remember when you bought the house, I was pleased with the big back yard – but it was pretty boring.  What a difference now!

 

 

Jennifer: 

Tony and I both grew up in the Southeast.  We have been corporate gypsies landing in Raleigh, NC, Portland, OR, and Boston, MA.  When Tony received an offer from Dell, we couldn’t wait to get back to the South and found Austin to be everything we were looking for with the weather, people, and lifestyle.  We gave away our snow shovels and made a commitment to a better life outdoors.  We agreed that the backyard was our favorite place and we were lucky that it was a “blank slate”. 

 

We evaluated joining a local pool versus building our own.  In an ideal world, we’d have both but having our own pool was more attractive because it would make our backyard the private escape and social place we wanted.  And when those temperatures soar, we gather outside and enjoy our investment (although Tony still calculates the dollars per dip)!

 

This spring we added a limestone patio with a fire pit.  This is used a lot, especially in the fall.  Tony was an Eagle Scout and loves to make fires and even cooks in a Dutch oven out there! 

 

The kid’s trampoline and swing set is in a mulch bed and disguised behind palms.  This area serves a more durable space for our pets too.  There is a storage area where pool supplies and equipment is kept.  We hid this behind a wire fence and flowering vines.  We stained the existing wood fireplace a dark brown for a dramatic background. The Tiki torches, string lights, and pool lights liven the atmosphere and show my passion for lighting.  Essentially, our outdoor space has been subdivided into comfortable “rooms”.  Each area has casual seating in groups perfect for entertaining.   

 

 

 

Roselind:

Are there parts of the interior that you want to tackle in the future?

 

 

Jennifer:

The next steps are refinishing the hardwood floors with a darker stain and a glossier finish to go with our décor. Then, we are replacing an old sliding glass door to the pool with a window and a bar counter for serving food and drinks from inside.  I hope these will be done in the next six months. 

 

Here’s my wish list (Tony rolls eyes): 

I’d like to expand our kitchen.  We usually eat at the kitchen island table and when the kitchen has all four of us and two big dogs nearby, navigating the room for the forgotten condiment proves challenging.  We have an enormous pantry that is great for storage but by expanding into this and a garage workroom, we gain about 7 more feet of floor space and another window in the kitchen. 

 

We would like to replace the ceramic tile in the kitchen and baths although my husband and I have not agreed on a material yet.  We own some basalt and granite slabs and copper sinks for the bathrooms and are just waiting on funds for the installation!  We would like to replace the standard fiberglass tubs with something more modern as well. 

Eventually, we plan to add a master suite over the garage to gain a guest bedroom.  This addition will serve to modernize the ranch exterior as well.  We’d like to build a pool house that serves as an office and bathhouse.  The entry will be off the limestone fire pit patio.  This is our forever home so we’ll build as we need instead of moving!

Roselind:

As an architect and interior designer, are you open to helping others who are thinking of remodeling? 

Jennifer:

Although I specialize in commercial work, specifically corporate and medical offices, during these times, I’m finding residential work is more readily available.  I used to think that the residential market was so different from the commercial world; and in way they are – different codes, materials, and client approach. But it’s all still design and it’s what I love to do!  I’m working on a kitchen remodel and overall facelift for a neighbor now.  My website is www.reddesignstudios.com.  I’m new to the area and am still building my practice, so I think I offer a great value on consultations. 

Roselind:

What advice do you have for people who are thinking of undertaking a remodeling project?

Jennifer:

I have found that many people may overspend on a project if they don’t have a professional partner.  Not “overspend” like they’re being overcharged but “overspend” because they spend money on things that don’t give them the biggest impact.  Many people are also missing out on real estate bargains or investment possibilities because they cannot see potential in the available property.  Having a professional shop with you can help the buyer understand how easily their goals and style can be obtained. 

Austin Texas Real Estate

Remodeling Decisions That Add Value: Better Living Areas

 

 The main living room is the central core area of your home.  It is both a private and public space that you share with family and guests.  The main living room should easily connect with dining areas, kitchen, and hallways to bedrooms.  This space should be given top priority in the hierarchy of rooms.  However, too often it is not. 

Sometimes the front door opens right into the living room, and the passage deeper into the house cuts right through it.  Please!  Before you go a step further, stop to imagine how you would furnish and enjoy being in a room like this.  If you home has this layout, consider some serious surgery to correct this problem.  Never allow walkways to cross through the middle of living areas.  This creates an unsettling division within the space which no furniture placement will solve.  If you have this floor plan, face up to it, and make the necessary changes before moving on.   

Most buyers today prefer two or more living areas.  In addition to the main living room, these may include a family room or den, a study, and a game room.  The trend today is to avoid wasted space.  Rooms that are used primarily for display have very little actual use and value.  Consider converting an unused formal living room into a study.  Sometimes a wall can be opened up to bring a seldom used room into a real relationship with the house.  This is much cheaper than adding on more space.  Remodeling tip:  Make better use of the space that you have.  It is cheaper than adding on. 

The “greatroom” is a popular layout that combines the living-dining-kitchen space.  This open style is efficient in its use of space, combining multiple uses.  The house seems bigger than it would if divided into small rooms.  You will be able to work in the kitchen and talk with family members and guests in the living area.  If you can open a wall to allow a better connection and more light to flow between spaces, you will be making a change that most buyers prefer.

If budget allows, a gameroom is a space that serves a multitude of functions.  It is a more private living area that is often used for TV watching, computers, pool table, or children’s toys.  The gameroom is often an upstairs common area that connects to bedrooms.  Special media rooms are sometimes added, although the trend today away from extra rooms that receive infrequent use.  Consider combining a media room with pool table, ping pong, or other gathering room functions.  

You cannot think about living areas without considering the traffic flow through rooms.  A natural and logical flow will guide people from the front door into the heart of the home – the main living area.  The pathway should not cut through the middle of rooms, or make you skirt around furniture.  Visitors should not be confused as to where to go.  A logical floor plan is crucial to making visitors feel welcome and comfortable in your home.  A great living area draws people into it in a natural way, and provides a center for common activities.  Remodeling decisions that place great importance on the main living area add value to the home.   

 Austin Texas Real Estate and Homes For Sale

Austin McMansion Ordinance – Considering the Consequences

Austin attorney, Chris Bradford, published an interesting article about Austin’s demographics entitled, How Austin’s Rise Became a Tale of Two Cities.  He looked at census data that shows that households with children are more concentrated in the suburban parts of the Austin area.  The reason, he says, is simply that people can get larger, cheaper, and newer homes in surrounding suburbs than they can in the central part of Austin.  I would like to add to his piece with a story from our own experience.     

A family relocating to Austin from another city tells us that they can afford up to $500,000, and would like to live in one of Austin’s central neighborhoods.  We show them homes in our older central areas with their eclectic mix of homes and tree lined streets.  Slowly, they become aware of the degree of remodeling necessary to make these homes suitable for their needs – a daunting task for most folks. 

For example, in one area (W of Lamar; E & N of Lake Austin; S of 2222) the average home between $300,000-500,000 may be described as follows: 

Price – $415,975
Bedrooms – 3
Baths – 2
Built – 1952
Size – 1,583 sq feet
Garage – 0 to 2

Even though they are older, these neighborhoods are suburban in nature, built around the use of a car.  Yet, often the garage has been taken in by prior owners for extra interior space.  Perhaps a carport and some storage could be added, my clients say. 

Next, we consider the house.  What can be done to make the structure better fit their needs?  Should they budget $85,000 to remodel and add on?  This will bring them to the upper end of their range for a home.  Will $85,000 be enough?  No, it will not.  Another 1,000 square feet would bring the size up to 2,583.  At $200 per square foot, this will come to $200,000.  

And what about the nearly sixty year old foundation, plumbing, wiring, duct work, and roof?  What about the new code requirements since 1950?  What about the amateur remodeling done in the 70’s and 80’s?  What about that silver wallpaper, popcorn ceiling, and vinyl siding that made so much sense at the time?  Remodeling is a tricky business that takes skill and experience.  Is this relocating family up to the job?  Or will they burn up a lot of money trying to renew an old structure, and find that their investment has burned up in the process?    

Perhaps this house should be considered a tear down.  Now we are up to $450,000 for a lot, including the demolition.  The usual rule of thumb is to allow about 25 – 30% for the land out of the total budget.  This calls for a $1.5 – $1.8 million total cost package.   

Perhaps a suburban neighborhood around Austin would be a better fit for our relocating family at this time in their lives.  There are plenty of choices – some suburban neighborhoods are quite close-in, others belong to a small satellite city.  Their choice is to adapt to a much smaller home in central Austin than they would prefer, or to move on to greener pastures – a suburb on Austin’s perimeter.  

We bought our first home in central Austin as college students years ago – the only young people on the block.  Over the years we have witnessed the central neighborhoods of Austin evolve.  A variety of people – from singles, to couples, to large family groups – moved in and improved or expanded their homes. Remodeling and revitalization was constant.  Demand was steady and prices moved up.   

Today, more than ever, the entry level budget for a home in central Austin is high.  But, many people would like to do as we did years ago.  They would like to buy a house with the idea of saving for a remodel and addition in the future.  They get their foot in the door, and figure out how to improve the house later.  It is a risk they are willing to take. 

In 2006, moving to central Austin got a lot harder.  The McMansion Ordinance added a new level of difficulty to an already expensive and risky process.  The word McMansion conjures up a cheaply made extra-large house that that is devoid of architectural integrity.  Ironically, this does not describe the mostly modern, craftsman, or prairie style homes built on expensive lots in central Austin in recent years.  

Under the Ordinance, homes are restricted to either 40% of the lot size or 2,300 square feet.  An expert is needed to figure out if your remodel plan complies with this law.  Does your house plan stay within the virtual three-dimensional envelope?  What about the side wall articulation (think of a 10’ chunk carved out of your dining room)?  Can you squeeze bedrooms into an attic or basement that does not count as living area?  And the carport – counted as living area if there is interior space above it, or not counted if free standing.  Do you have the presentation skills to ask for a variance?  How many billable hours will it take to figure out what you can legally do?    

Austinites have lived with this ordinance for three years.  Perhaps it is time to take a look at how these rules are working for homeowners.  Are people happy with it, or are they giving up in frustration on remodeling projects?  Have we weakened demand for central Austin neighborhoods?  And, could this ordinance lead to some unintended consequences, as Chris Bradford points out?

Website:  www.weloveaustin.com

How to Show Your Home: Should You Stick Around?

This is a blog series on preparing for a successful showing of your home for sale. In a slower real estate market, sellers cannot afford to ignore any part of the marketing process. Price, preparation, and presentation must be compelling in order to attract a buyer.

The price must be set realistically. Preparation should be complete – with paint touched up; space de-cluttered; floors clean or updated; and glaring repairs handled. And, presentation should be meticulous – with drapes open; lights on; interior immaculate; and lawn mowed.

Now you are ready to show your home. This is the final step in winning the heart of a buyer. A call for a showing is an expression of interest in your home. The potential buyers are clearly interested in your neighborhood, and have most likely seen your home on line. They are willing to invest their time for a visit. It is worth the effort to make each showing one that will be remembered.

Should You Stick Around?

Generally, it is not a good idea to be present for the showing. Remember that this is not a social visit. Most buyers will feel that they are intruding on your privacy if you are in the house. They may shorten the time spent in your home. Or, they may not be able to discuss your home as freely as they might have. If it is difficult to leave, you may sit outside or take a short walk.

Sometimes sellers try to offer certain information, and they inadvertently turn the buyer off. It is best not to make assumptions about what the buyer wants. Keep in mind that buyers are there to make a big decision. They need some time to experience your home on several levels. If it passes the first test, there will be time to communicate how many water heaters you have and other facts about the house.

I recall one showing in which the seller questioned the buyers about whey were looking for.  This is not an easy question to answer.  They are figuring this out as they absorb the inventory.  In another case the seller actually grilled the buyer on his reaction to every room, and then argued about it.

It was a relief to leave.

Austin Texas Real Estate Guide

Did You Buy a Home in 2008?

If so, then it is time to establish your homestead exemption in Texas.  To be eligible for the Homestead Exemption for 2009, you must have lived in your home on January 1 of 2009.  You should receive an application in the mail from the Tax Appraisal District.  If you do not receive one, you may get it online (links are below). 

 

There are two reasons to establish your exemption:

(1) Get a reduction in property tax.

(2) Start the “annual 10% limit” on property taxes increases that applies to owner occupied homes.

 

So, it is important to send in your application form.  In May, when your “Notice of Appraised Value” arrives, make sure that “homestead” is shown on the form.  If you have any questions please feel free to call me to discuss it.  I will be happy to double check your record.

 

Disregard any letters asking for money to file for a homestead.  There is no cost to file for a tax exemption of any kind.  It only needs to be done one time, and will stay on your property as long as you own it.  There are other tax exemptions that one could apply for such as Over 65, Disabled Veteran, etc.

 

All my best to you in 2009!  If you know someone who needs to find a new home in Austin, I would love for you to give them my name and website. 

 

Links to Appraisal Districts:

 

http://www.traviscad.org/

 

http://www.wcad.org

 

http://www.hayscad.com  

 

Website:
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Subprime Mortgages: Playing Against the House

In the old days, before about 1998, subprime mortgages were an alternative for borrowers who did not fit normal guidelines.  Maybe they just started a new business, or had some past credit problems.  Borrowers paid a higher interest rate or put more cash down to compensate the lender for taking a higher risk.  The funds for these loans came from private investors who accepted higher risk for higher returns. 

 

In recent years a new type of subprime mortgage was created.  This loan was designed to help a lot more people buy houses, and indeed it did.  It became so popular that, from 2005-2007, this subprime loan accounted for one-third of all mortgage loans issued. 

 

Borrowers often had qualification issues, such as: debt repayment problems; no past credit; low FICO scores; minimal job history; previous bankruptcy; poor documentation; or no cash for down payment. 

 

Typically, these loans began with a low rate for the first two or three years.  Often the payment was set so low that the loan went up each month, absorbing the unpaid interest.  Then a very high rate would kick in.  

 

How was it possible to make these loans?  What made them work?  The strategy was this:  Rather than rely on the borrower’s credit worthiness, they relied on rapid house appreciation followed by re-financing.  This was the new feature that made these loans different from prime or old subprime loans.

 

The new subprime loan often had a pre-payment penalty that prevented borrowers from paying them off early.  The low initial rate was not profitable, so the loan needed to go into its second phase to become profitable to the lender.  Squeezed between a pre-payment penalty and an impending high interest rate, the borrower had no choice but to re-finance after two or three years.  If payments were made on time, and if their financial condition improved, and if the house went up in value, then the borrower might qualify for a prime loan. 

 

However, most borrowers did not get a prime loan at refinance time.  They got a new subprime loan, extending the need to re-finance.  Of course, re-finance fees were charged.  The lender had a lot of control over the borrower at refinance time.  For these borrowers, re-financing was not a choice made at their discretion, as it is with prime loans.  It was a necessary part of the subprime loan itself.  

 

You could say that the new subprime loan was, in effect, an agreement to allow mortgage lenders to play the real estate market – betting all their chips on appreciation. 

 

What about the borrower?  Borrowers looked around and saw lots of folks buying houses using subprime loans.  Home values were on the rise from about 1998 to 2006.  In many areas homeowners saw 25 – 50% appreciation in their home values. So it seemed to be a safe bet. 

 

Instead, it was, effectively, a large pyramid scheme – the more people who participated; the more the early players were rewarded.  The cycle was self perpetuating.  Demand for homes raised prices; higher prices attracted more people for easy loans. 

 

Subprime loans were financed through complex securitization structures, with multiple levels of risk spread over many parties.  And, investors could buy insurance protection, shifting their risk to other entities.  The layers of complexity were astounding.  The only people who seemed to understand the structures were the investment bankers who created them. 

 

Investors did not know very much about what they were buying.  They trusted the bankers and rating agencies to protect them.  And, no one at any level seemed to know how dependent subprime loans were on market appreciation.  They did not understand the need to refinance under better market conditions, implicit in the loan.  This need for market appreciation made the investment a very high risk – in fact, doomed to failure. 

 

When the problem began to be perceived by investors in mortgage securities, the placement and ownership of risk was very hard to figure out.  There was confusion, and then the worst possible reaction – panic. 

 

Investments in mortgage securities ended; investment banks closed; and related financial institutions were hurt.  The panic spread, and people pulled their money out of other markets. 

 

Real estate roulette was possible because the borrowers who received money, and the investors who provided money, were not clear about the high level of their risk.  Had they understood the almost certain downside, they might have left the table before the game got out of hand.

 

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Austin Real Estate Market- Angelou Interview

I recently attended a round table discussion with economist, Angelos Angelou, on the Austin real estate market. Here is a summary of our conversation:

In Austin, we have one of the most stable real estate markets in the country. Nevertheless, Austin is not immune to the turmoil in the housing, financial, and equity markets that is occurring throughout the country.

“We have been impacted here as well from the repercussions of the credit boom that made it so easy to buy homes, cars, and develop real estate. The negative impacts on our economy should last through most of 2009.”

Right now in Austin we know that home sales are sluggish. “There is about a 10% – 30% decline in sales, depending on the area and price range. In times like these buyers tend to hold back, hoping for better buys in the coming months. This slows the market even more. On the positive side, there will be some pent up demand when the bottom is perceived to be reached.”

“As the national economy moves into a recession, job growth and retail sales will decline. This will further slow the national housing recovery. In Austin, the economic problems have been limited to the tightening of credit markets, and have not yet translated into job losses in the wider economy. To be sure, most businesses, are feeling the pinch of reduced sales.”

Historically, in difficult economic times, people tend to move to places where the economy is healthy and there are jobs. This will help Austin weather the downturn. The positive perception of Austin as a great place to live attracts newcomers. Newcomers with good jobs, in turn, keep the housing market moving. Movement in home sales keeps prices stable and modestly appreciating.

“Areas like Austin tend to recover quickly, no matter what the challenge might be. Folks do not need to be recruited to move to Austin. They already want to come here. Very few cities have this kind of mystique. The Austin brand is strong. The University of Texas and state government are mainstays of our economy. We have a youthful workforce, with 36% in the 25 – 44 age range. This is the demographic that high tech companies want.”

However, Austin is evolving as a high tech center. In 2000, there were about 120,000people employed in 1,600 high tech companies in the Austin area. In 2008, there are about 85,000 people working for about 1,200 high tech companies. We all are aware that many high tech jobs (manufacturing, support, call centers, etc.) have moved to Asia and other countries. In Austin, we are moving toward high tech start ups and research & development, rather than high tech manufacturing.

In today’s difficult times it is more important that ever that our city leadership re-focus its efforts to attract companies that provide jobs in Austin. The needs of engineering companies, versus manufacturing companies, versus research and development companies are very different. There should be a strong, unified public policy focused on recruitment and retention of companies that provide quality jobs.

“In the 1980’s our city leaders joined with the University of Texas and the Chamber, and went after high tech jobs. They put Sillicon Hills on the map. Today we need that kind of concerted effort and attention. We hear of some successes, but there have been many missed opportunities to recruit quality companies to Austin. We don’t hear of the companies that quietly selected another city. Under the leadership of the Chamber, economic development must be supported with all of our enthusiasm and tenacity, and with one voice, to create the high paying jobs and capital investment that we need to support our quality of life.”

Mr. Angelou is adamant about two things:  The first is the need to promote economic development with a focus on recruiting new and impactful companies. And the second is the need to improve on the rate of companies that select Austin, after considering Austin. This kind of momentum and leadership is required to create the jobs that, ultimately, sustain our housing market.

Mr. Angelou will give an overview of the Austin economy and offer projections at the annual Economic Forecast event at the Convention Center on Jan. 15, 2009, from 7:00 –9:45 am.

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Austin Job Growth

Austin’s job growth is staying positive. Here is a ranking of job growth from among the top 500 largest metro areas in the country.  Austin’s rate of growth places it #5 in the country.  That is a good place to be.   

  

Fastest Growing Metro Areas

 

Sept. 2007 – Sept 2008  -  Increase in non farm payroll

Austin Chamber of Commerce Data

 

1.  Virginia Beach MSA               2.2%

2.  Houston MSA                       2.2%

3.  San Antonio MSA                  2.1%

4.  Seattle MDiv                         2.0%

5.  Austin MSA                        1.9%

6.  Dallas MDiv                           1.9%

7.  Fort Worth MDiv                   1.7%

8.  Charlotte MSA                      1.6%

9.  Washington MDiv                  1.5%

10. Boston MDiv                        1.1%

 

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Green Building Project: Leuders Shower

The house we are building is a simple farmhouse style. The appeal is in the views, open space and honest use of materials. Decorative touches can come later, from furnishings, accessories and things people have. If the construction elements are too decorative, then personal items that are added later will overload space, we feel.

For this reason, we prefer to let bath tile be a background element, rather than a decorative feature. No contrasting backsplashes, colored stripes, carved tiles or other accents that draw attention will be used.

Here are the tile choices that were considered:

White subway tile: Subway tile has been popular in recent years, and we see it a lot. The old vintage version of this tile is a 3 x 6 inch, flat tile, with square cut edges. Today’s version is thin, with rounded edges, and is often a little pillowed. Somehow the modern version looks a lot like the basic 4 x 4 bath tile that is commonly used, but with a different shape.

Colorful ceramic tile: There are some beautiful ceramic tiles to choose from. We visited Architerra, in the Penn Field Center, several times and loved a lot of their tiles. Some of their simple 4 x 4 bath tiles had great lush color, and they would have been fun to use.

Travertine: We have used Travertine several times in bathrooms, and were satisfied with the choice. It is durable, and inexpensive. The problem with Travertine is that we are tired of it, and it is a bit too busy for the room.

Slate: We have used slate in the past, and liked the earthy, rustic look. However, this time it was too strong for the room size and style that we wanted.

Leuders Limestone: This is a grey-tan tile that is cut from Leuders stone, a dense limestone quarried in north Texas. Leuders stone is often used as an exterior material. It is indigenous to our area, and a good fit with the Texas farmhouse style.

We settled on Leuders Limestone as the right tile for this house. It seemed to pick up and continue the natural grey concrete floor. The walls are off white (Sherwin Williams – Raime), and trim is light sage green (Sherwin Williams – Nacre). The color palette is stone grey, tan and green.

The Leuders tile was purchased at Materials Marketing in 16 x 16 pieces. They cost about $7.00 per sq.ft. Our tile man cut them to make 8 x 16 and 4 x 16 pieces. These were alternated to create a pattern.

Leuders Stone Shower

We used Leuders in tile form, set by our tile contractor. However, it is worth noting that an Austin fabricator, Berthold Haas , makes beautiful slab countertops, fireplaces, and other architectural elements from Leuders limestone.

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Austin, Texas – Still a Solid Market

During the last few years, a lot of people saw their friends and neighbors moving into home ownership or becoming real estate investors. They saw real estate values rising and became aware of the endless supply of low-interest credit. So, to a great many people, it seemed to be the right time to get in.

Unfortunately, a lot of mortgages were set at teaser rates, with the need to refinance later in order to avoid higher rates. Home buyers did not appreciate the risk of making a highly leveraged bet on short-term market gains. The only downside that home buyers could imagine was a leveling off of home prices – not a fall in prices.

Homebuyers did not realize how many other people were making similar bets on increases in housing values. And, they did not appreciate the destabilizing effect that foreclosures could have on home prices.

When foreclosures began to happen, they undermined many real estate markets across the country. The widespread fall in home values has mushroomed into a crisis for our financial system, and economy as a whole.

How is the Austin market weathering this crisis?

In Austin we are not entirely immune from the turmoil in the financial and credit markets. Demand for homes has slowed. When people can’t sell in other states, they can’t buy in Austin. We have some areas of oversupply of homes and some foreclosures – mostly in suburban areas that were targeted by investors. But on the whole, Austin has escaped the devastating effect of foreclosures, excess inventory, and falling prices that many cities are experiencing.

The important thing is that values in Austin did not rise exceptionally during the last few years and are not falling precipitously. Housing Predictor, a market research company, has identified 10 markets where the strong regional economies have the best potential for increased prosperity. These are listed below:

Top cities, with the percentage of price appreciation in 2008:

1. Biloxi, Miss. – 4.9 percent
2. Salem, Ore. – 4.7 percent
3. Bismarck, N.D. – 4.6 percent
4. Spokane, Wash. – 4.4 percent
5. Yakima, Wash. – 4.1 percent
6. Austin, Texas – 4.0 percent
7. Grand Junction, Colo. – 4.0 percent
8. Fargo, N.D. – 4.0 percent
9. Mobile, Ala. – 3.9 percent
10. Albuquerque, N.M. – 3.5 percent

Source: Housing Predictor (11/15/08)
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