Travis County residents will be relieved to hear of new development in the works from the Texas Department of Transportation: the expansion and realignment of FM 973. The proposed development would include rerouting the road east for roughly 5.6 miles between U.S. Route 290 and State Highway 130 toll road. This would allow for an intersection with downtown Manor. It would also expand FM 973 from two total lanes to six, with a grassy median in between.

FM 973 Congestion

This proposition comes after a long-standing traffic issue raised by the surrounding community. Congestion on that highway has become unreasonably high. With the newly established Tesla Gigafactory located nearby, residents have raised concerns about the massive influx of workers (thousands currently employed at this location) being the culprit for this increase in traffic congestion. 

State Improvements

The state’s plan to realign and expand FM 973 could significantly impact the surrounding business and improve traffic for residents. The Texas Department of Transportation stated that the “purpose of the proposed project is to improve mobility and connectivity and provide additional roadway capacity to meet future traffic demands due to population growth.”

With the rapid development and growth of the Tesla Gigafactory, this project will create more accessible access to and from the factory as it continues to develop. This project will also prove to be a beneficial change for the nearby residential areas as well. Providing a better system of transportation and easing congestion will allow neighboring communities to stand out as prime locations for real estate investments and upcoming developments. Already, some communities are underway, such as Lagos by Ashton Woods and Whisper Valley.

Don’t hesitate to reach out with any questions about the expansion of FM 973 or any other developments happening in the area. Email me at tmcneil@kw.com or contact me here with any questions!

It has never been a better time to be a homeowner. And the 2022 U.S. Home Equity & Underwater Report from the real estate data provider, Attom has shown that rising home prices have made the Austin housing market one of the most equity-rich markets in the nation. As we near halfway through what has been an unprecedented year in real estate, news of an increase in equity-rich homeowners is an excellent sign for homeowners and potential sellers. 

Attom’s Findings

The report shows that, in Austin, 73.8% of homeowners were considered equity-rich in Q1, up from 41.9% during the same quarter in 2021. Attom also analyzed over 8,000 U.S. zip codes in this report, revealing that 37% were equity-rich and eight of the top ten zip codes were in Austin.

So, how did rising prices contribute to this trend? Todd Teta, Attom’s Chief Product Officer, made these remarks in regards to their report: “As home prices kept rising, so did the equity built up in residential properties, to the point where close to half of all mortgage payers around the country found themselves in equity-rich territory,” meaning that these homeowners owe no more than half of their property’s current market value. 

Rick Sharga, Attom’s executive vice president of market intelligence, commented on this report as well, noting the benefits and challenges these numbers reveal about the housing market. “Homeowners continue to benefit from rising home prices…Record levels of home equity provide financial security for millions of families, and minimize the chance of another housing market crash like the one we saw in 2008. But these higher home prices and rising interest rates make it extremely challenging for first time buyers to enter the market.” 

June Housing Market

While rising prices make it more challenging to enter the market as a first-time buyer, news of the current housing market shows signs of cooling. The June Housing Market Report from the Austin Board of REALTORS® has shown a dip in home sales and an overall slow in the increase of residential home prices for the area. Surrounding areas have also experienced this market deceleration, indicating that buyers should still hold out hope for more footing in the coming housing market.

If you are a current homeowner, curious if you fall into this equity-rich category, or are in the market for that perfect home, contact me, and I’ll give you the rundown on why Austin is the best place to buy!

With the Tesla Gigafactory fully established in Austin and now Elon Musk’s, The Boring Company, settling its headquarters in Pflugerville, exciting new developments are coming to the area. With numerous Tesla projects on the horizon, there has been heaps of speculation about the intended use of some of Musk’s more recent proposals.

Upcoming Projects

Since first relocating to Pflugerville in December of 2020, The Boring Company has launched full force into discussions with the state and municipal governments to start development on multiple projects. Until recently, it had seemed as though little was moving forward. 

Private Access Tunnel

On June 21, The Boring Company quietly filed a proposal for a “private access tunnel” under the name “Colorado River Connector Tunnel.”

While there is very little information about this private access tunnel that would be dug under the Tesla Gigafactory in Austin, the idea of underground tunnels running across Texas is not a newly proposed one.

Pedestrian Traffic Tunnel

The Boring Company, in collaboration with Tesla, has been clear about its goals in digging transit tunnels in cities across the country. These developments would dramatically help in the process of alleviating traffic congestion while simultaneously freeing up real estate that was previously dedicated to surface highways and roads. Boring was recently approved for its tunnel expansion in Las Vegas and beginning development of a pedestrian tunnel in the south Austin suburb, Kyle. 

The proposed tunnel would connect Plum Creek, the 2,200-acre residential development housing over 5,000 properties, with Kyle Crossing, the retail development located at Interstate 35 and FM 1626. In its filing for this pedestrian tunnel, The Boring Company also received approval for a $50,000 professional services agreement for a feasibility study as its initial steps.

Loop System

Knowing Tesla and The Boring Company’s track record, a plan is always hiding in the framework. These projects, alongside many other developments expected from The Boring Company, will work cohesively in enhancing the traffic system in the Austin area. One such overarching project was a loop system. This project would connect downtown Austin and the airport with Tesla Gigafactory Texas. 

Some informants following the development of this upcoming project have speculated that it could be part of Musk’s plans to transform the land near his Texas Gigafactory into an “ecological paradise.” His original remarks on this project are as follows: “It’s about 2,000 acres and we’re going to make it a factory that is going to be stunning. It’s right on the Colorado River. So we’re actually going to have a boardwalk, where there’ll be a hiking/biking trail. It’s going to basically be an ecological paradise, birds in the trees, butterflies, fish in the stream, and it’ll be open to the public as well.”

Whether these private and pedestrian tunnel projects are elements of the proposed tunnel systems, a connection to Musk’s “ecological paradise,” or something else entirely, this is exciting news.

Moving Forward

While there is only speculation at this point with many of these developments, news of a filing for this private access tunnel could mean that things are getting underway. Projects like these will contribute immensely to Austin’s continued growth by providing easy, unclogged transportation. Keep your eyes open, Austin is about to become a central hub, linking the rest of the state together. 

Feel free to contact me at tmcneil@kw.com for any questions about these developments or if you’re curious about other exciting news happening in the Austin area.

Formerly known as East Pecan Street, Sixth Street is distinctly Austin. It is framed by large, Victorian-age buildings, bustling restaurants, bars, and entertainment venues. While these buildings have remained steadfast in their historical roots, the social function of “Dirty” Sixth Street has constantly evolved throughout the years. The city’s entertainment district dates back to the late 1800s, with many buildings as old as the 1870s and 1880s. Despite its unmoving foundation, Sixth Street transformed into a shopping district from the early 1900s until the 1950s. 

The early 1970s saw the first battle to preserve the street’s historic character. Despite calls for renovation and demolition of certain buildings, Sixth Street officially became a historic district in 1975 to preserve and protect the rich history running through the street. Today, Sixth Street is known as the life of the party. A true testament to the entertainment scene, the street boasts an eccentric mix of nightlife alongside ancient Austin history.

New “Rejuvenation” Plans

If there was one thing that Austinites could attest to Sixth Street, it would be its ever-changing nature. Running from Congress Avenue to I-35, this nine-block stretch has been the topic of choice in recent years as developers hope to transform the street once again. In the past summer months, Sixth Street has seen plans for additions of office buildings, hotels, restaurants, and newly updated entertainment venues. The plans also include a proposal to increase the height limit for buildings on this street to make way for these new high-rise developments.

These changes are in hopes to transform the street into a more cohesive Austin area, one that makes Austinites proud to frequent. There are locals on both sides of the proposed plan, with many residents wary of new developments and the preservation of the historic elements on Sixth Street. Plans to keep the historical protection of these landmarks intact were initially scheduled for early June, but the Austin City Council has pushed the discussion until July 28th. 

Sturdy Sixth Street Evolves

Despite these concerns, development is often considered a positive thing, especially for such a historic and famous district in Austin. Modernizing this street while still protecting and maintaining the historic fabric of Sixth Street will also boost the value and attraction of nearby neighborhoods. The foot traffic from these neighboring areas brings bubbling life to downtown Austin and creates a must-see destination for residents and new visitors hoping to make Austin their permanent residence. 

Sixth Street has been a bustling life force of downtown Austin since 1839, evolving and changing with the times every few years but remaining a robust historic foundation for the city. If you have any questions about new innovative plans for Austin, feel free to reach out to me at tmcneil@kw.com. I love Austin and am always on the lookout for exciting things to come to this incredible city.

Nestled within Austin is a gem of Texas natural beauty, the Walter E. Long Metropolitan Park. Just a few miles from downtown, this 1,200-acre park is beloved in its community. Residents from surrounding communities flock to enjoy its prime boating, fishing, and swimming features. This immense lake was initially created to aid the nearby Austin Energy facility’s energy production. However, it has transformed into a hotspot for the Austin community to enjoy an endless stream of outdoor recreation. 

The Master Plan

As the surrounding metropolitan areas grew and developed over the years, locals have longed for the same development and attention to be placed on their favorite park. Luckily for them, an ambitious $800 million master plan was drawn up and unanimously approved by Austin’s Park and Recreation Board in 2019. This five-phase master plan will work to develop and innovate the 1,200-acre lake as well as the surrounding public land, accounting for nearly 3,700 acres. 

The master plan, often described as “several parks within a park,” focuses on four primary levels of use in its projected development. The natural areas, such as the protected prairies that run through the property, will remain practically untouched. The recreational areas, however, will be split into passive and active sections for gatherings and events that could be run by the Travis County Expo Center located on the land. This plan also includes numerous proposed components for the future of the land, including a cultural arts center, a boardwalk, hiking trails alongside equestrian areas, an amphitheater, a sculpture garden, rentable cabins, and so much more.

Community Benefits

While the timeline for this specific project will span decades, this plan is dedicated to transforming the land into a fantastic new attraction for residents and visitors. This future development for East Austin’s Walter E. Long Park will provide benefits throughout the Austin area, creating a space for residents to locally enjoy all kinds of recreational activities. Since the park is only 12 miles from bustling downtown, residents and visitors alike will have easy access to this beautiful attraction. This master plan is designed to be a comprehensive plan for the new and continued development of great Austin neighborhoods, boosting economic growth, providing stable jobs, improving connectivity throughout the city, and providing a high-quality public space for East Austin.

Feel free to contact me at tmcneil@kw.com for any questions about more developments in Austin and what this Walter E. Long Park master plan means for the city.

Great news for all the Austinites who always dread the summer heat: The Colony Park Aquatic Center project is well underway! Conceptualized out of a need for aquatic recreation in the Colony Park and Lakeside areas, the completion of this aquatic center will be a historic occasion. 

Set to be located in Northeast Austin at the 93-acre Colony Park District Park, the center will house a lap lane pool, tot pool, water slide, spray ground feature, training/party room, and office space for the aquatic center itself. New community developments also show that this project will participate in the City of Austin Arts in Public Places program in order to commission a unique art installation at the center upon completion.

An integral part of Colony Park’s master plan involves providing support and access to housing for the community alongside providing a new aquatic center. A new mixed-use development, fondly nicknamed “mini-Mueller,” will transform the Colony Park area. Residents can expect over 3,000 new homes and apartments and up to 960,000 square feet of commercial space, including offices, stores, and restaurants near Colony Loop Drive and Loyola Lane. On March 24, 2022, the Austin Council approved these efforts, making the Colony Park Sustainable Community a top priority moving forward.

The Colony Park Aquatic Center has been in development since early 2021, and progress is moving quickly. After numerous community meetings and surveys that provided a space for the public to voice their vision for this center, the project has reached its Design Phase while preparing to submit for permitting in 2022. It is expected to begin construction in early 2023.

With heavy involvement from the community, this exciting project received funding through the City of Austin 2018 G.O. Bond, which will help extensively with its expected $13.1 million budget. With construction set to be completed at the beginning of 2024, The Colony Park Aquatic Center will be a greatly anticipated space for all Austin local communities, particularly residents from Colony Park.

You can learn more about these projects here or contact me at tmcneil@kw.com to discuss other exciting developments in Austin that you can expect in the near future.

If you were looking for more reasons to move to Austin, look no further than Project Connect. Originally envisioned to link Austin geographically, this project has grown into much more than an interconnected transportation system. Project Connect will improve public transportation for the entirety of Central Texas while providing better access to housing, entertainment, activity centers, and more.

Fondly known as one of the fastest growing cities in the United States, Austin has increased exponentially since 2020, both in population and development. And with such immense growth comes the need for stellar transit systems. This is where Project Connect comes in, connecting far East Austin to the rest of the metro through public transportation. 

The City’s Investment

With its initial approval in November 2020, 8.75 cents of Austin’s property tax rate revenue would be dedicated to funding this project. $300 million of the city’s initial investment will go towards Project Connect’s Anti-Displacement Initiatives, designed to help affordable areas stay affordable for residents who wish to remain near transit lines.

In early April 2022, a new report announced that cost estimates were rapidly increasing for elements of Project Connect, nearly doubling the initial $5.8 billion investment presented to the community. 

A Breakdown Of The New Lines

Blue Line

The Blue Line will run for 8.2 miles, from the airport, over Lady Bird Lake, and into Downtown Austin. Designed to improve high-capacity transit (HCT), support air travel growth at the Austin-Bergstrom International Airport, and provide access to affordable housing, employment, and activity centers, this line is estimated to take nine years to complete.

Orange Line

The Orange Line is a 20-mile light rail transit with 22 stations that will operate along Lamar Boulevard and Congress Avenue south to Slaughter Lane, connecting the UT campus and downtown. It is scheduled for completion in nine years and will help eliminate transportation congestion and create a reliable, safe, cost-effective HCT option.

Red Line

When complete in three years, the Red Line will run from downtown across Central and Northwest Austin, connecting the more extensive transit system as a whole. This line is focused on connecting residents to activity centers, impacting neighborhoods like Crestview through Park and Rides at Howard, Lakeline, and Leander. It is a 32-mile and 9-station route, with new stations set for Broadmoor/Domain and McKalla at the Austin FC MLS soccer stadium.

Green Line

The Green Line will cover 25 miles and connect ten stations. Scheduled to be completed in five years, it will run along CapMetro’s freight line from downtown Austin to Colony Park, with future development to Manor and Elgin. This line will emphasize transit for households within Central Austin and beyond and provide connectivity to the Red Line and CapMetro’s bus network.

Benefits For Austin

By expanding and improving the transit network already in place, this program will connect people to opportunities that would otherwise be inaccessible to them. Streamlining access to healthcare, education, entertainment, and affordable housing, all while striving to maintain sustainability, this program promises great things. 

With the city’s interconnectedness, the real estate market will flourish. Residents of Austin’s bordering neighborhoods will now have easier access to the city’s exciting downtown. This will make those areas prime real estate for homebuyers wanting to enjoy both the excitement of the city and the tranquility of Austin’s suburbs.

Project Connect’s vision to create more sustainable, equitable, and liveable interconnected communities will cement Austin as the central hub of Texas.

If you have any questions about the future of Austin real estate with Project Connect, please contact me at tmcneil@kw.com or call 970-627-7392.

Images courtesy of Project Connect.

Closing day is, arguably, the most exciting day in a real estate transaction. It’s the day where you get to take possession of your new asset or collect proceeds from the sale of your home. In a standard residential transaction, this may seem like another term or step in the process — one that is 30-45 days away from the contract’s execution date. But did you know that strategically choosing the closing date could provide you with up to an extra 30 days to pay your first mortgage payment? Find out how you should be leveraging your closing date!

You see, your first mortgage payment is due on the first day of the second month following your mortgage closing. Meaning, if you closed on June 15th, your first payment would be due on August 1st. Paying your mortgage differs slightly from making rent payments, which are typically paid for the upcoming month. Mortgages are paid in arrears, which means you’re paying for the previous month.

For this reason, closing early in the month can provide both investors and homeowners more flexibility with their cash flow. As an investor or a homeowner, it could provide you a full 60 days after closing before your first payment is due. This could be extra time you use to take care of make-ready repairs, find and vet the right qualified tenants, or purchase some appliances or furniture. It can also significantly change the numbers on your cash flow for a rental property if you can find and place a tenant within the first 30 days. The prorated rent + the first month’s rent would all be a net income because there is no MPI expense until the following month.

Utilizing this strategy can also help you in a leaseback scenario with multiple offers. Oftentimes sellers expect a free leaseback or look for one when considering offers. Paying a mortgage while someone else occupies your new home could be a tough pill to swallow for a lot of buyers. Aligning the closing date to be on the first of the month with the leaseback termination date to be on the first of the following month could provide you with a win-win scenario that gets you to an accepted offer. That’s because the first payment wouldn’t be due until 60 days after closing.

As you can see in the chart below, the earlier in the month your transaction closes, the more time you have to make your first payment. While sellers will often prefer the fastest close possible when reviewing offers, it may be a term you can negotiate in a give and take scenario. Using this payment schedule, you can leverage your closing date to maximize your cashflow flexibility.

I am happy to help you leverage your closing date to work for your schedule and your budget. As your real estate advisor, I put my knowledge and expertise to work for you, and I offer all kinds of resources, including a deal calculator. If you have any questions, please contact me at tmcneil@kw.com or (970) 627-7392.

If you’ve been pursuing your passion for investing in real estate, you may have heard, “Your home or the house you live in is not an investment — it’s a liability.”

While this statement at its core can be true, it doesn’t mean that your primary home can’t be an investment. All it takes is the right plan.

Typically, when buying an investment property with traditional financing, the bank will require a 20% down payment. Which, depending on your market, could be anywhere from $20,000 – $100,000+. This is where purchasing a home as a primary residence can have a huge advantage, especially for those just starting out. You can put as little as 3.5% down on an FHA loan as long as you live in the property for a year. Taking advantage of that opportunity can reduce your capital investment tremendously.

But how do you make that primary residence an investment if you live there with no roommates? You do so with the BLRRRR method.

Now, you’re probably thinking BLRRRR? Doesn’t he mean BRRRR? No, that is not a typo. While the BRRRR strategy (Buy, Rehab, Rent, Refinance, Repeat) is tried and true, it requires a hard money loan or a 20% down payment and a higher interest rate.

The BLRRRR method (Buy, Live-in, Rehab, Refinance, Rent, Repeat) is a longer investment (2-3 years), but it can allow you to stretch your capital the furthest while still having ownership rights and taking advantage of a lower interest rate and a significantly lower down payment.

Breaking down the BLRRRR Method

1. Buy

The most important step of the process is buying the right property. Look for the path of progress in your market. Where are the new highways extending to, what businesses or companies are coming to the area, what does future public transportation growth look like? Targeting areas that are along this path of progress will maximize the probability of your home appreciating over the 2-3 year period you plan to live there. Look for a home with good bones and mechanical systems that can be updated with little effort and knowledge or a home that has a flexible layout and lot that would allow for conversion or extension of living space.

2. Live-in

Living in the home, house hacking, and renting out additional rooms right away is a bonus to this strategy but not required. Living in the home provides a few advantages, like a lower interest rate, lower monthly payment, and tax benefits depending on the state you live in. States like Texas, Florida, Iowa, Kansas, Oklahoma, and South Dakota all have a homestead tax exemption, which puts a cap on how much your property tax bill can change year-over-year and reduces the assessed taxable value of your home. This means you’ll pay less property tax vs. a traditional investment property. Additionally, living in the home for 2 of the last 5 years will protect up to $250K (single) and $500k (married) equity from capital gains tax if sold according to the current tax code.

3. Rehab

The rehab portion is at your own pace, as you won’t be under the gun to pay off that hard money loan. While this works best for DIY’ers, it doesn’t mean you can’t succeed if you hire contractors. Your goal during the rehab is to work on projects in phases and not over-renovate. A budget of $5-10K per year in upgrades can go a long way. When renovating, have your future renter in mind. What products are durable, what appliances/ fixtures are energy efficient and low maintenance? What can you add that will attract the best tenants? These are all things that should be considered in step one and executed throughout your occupancy.

4. Refinance

This is where the fun starts. It’s now 2+ years since you bought this home, and you’ve been making cost-effective, functional updates. The house has appreciated 3-10% each year (depending on your market), plus you’ve added value to the home with your renovations — let’s call that 20% and say you got close to dollar for dollar back inequity on the rehab costs (it will be more for DIYers). You are now in a position to either pull a Home Equity Line of Credit (HELOC) or refinance and pull your initial investment out. Both those options allow you to access up to 80% of the appraised equity in the home. For example, let’s say you purchased a home in Austin, Texas for $280,000 with $9,800 down (3.5%), you spent $20,000 in upgrades over two years that increased the value of your home by $40,000, and the path of progress has reached your neighborhood, your house has now appreciated 8% both years. That same house is now worth $370,000. The bank will now allow you to refinance or open HELOC because your equity is around 30% despite only putting 3.5% down. You can draw on up to 80% of the equity, in this case, $72,000, giving you a 20% down payment for your next property

5. Repeat / Rent

After pulling out your initial capital investment of this property with a refinance or a HELOC, you can now use that equity to repeat this process. You can either upgrade to a larger home at essentially the same cost as your first home because of a higher down payment, or you can find another property to repeat the process, allowing you to collect cash flow on the first property while it appreciates. If and when the home value increases, you can continue to use that equity to purchase other investments. This is how you build wealth.

The BLRRRR method is my favorite way for anyone getting started in real estate investing because it allows the investor time to learn, put their team together, and get started with limited capital and risk. If you have any questions about investing in real estate, please contact me at tmcneil@kw.com or (970) 627-7392.

What is a homestead exemption?
A homestead exemption allows you, the homeowner, to remove a portion of your home’s value from taxation – therefore lowering your property taxes. For example, if your home is appraised at $200,000 and you qualify for a $25,000 exemption, you will only pay taxes on a home worth $175,000.

How do I know if I qualify?
First and foremost, the property must be your primary residence – the address needs to match the one on your driver’s license. In Texas, you can also claim the land you maintain for residential purposes – not to exceed 20 acres.
Second, you must have bought the home before January 1^st of the current tax year. For example, if you purchased a home on December 24, 2019, you are eligible to apply for the homestead exemption this year. But, if you didn’t purchase your home until January 2, 2020, you are not eligible to file until the next tax year.

How does it work?
To receive the homestead exemption, you must apply with your local county tax appraisal office – either in-person, by mail or online. Once you have filed, you do not have to submit an application for the same property again as it remains on the property until it is sold or you take up primary residence at another property.

Where to file?
As the homestead exemption is filed by county, below we have provided links to the county website resources in and around our area:

• Williamson County
• Travis County

When to file?
The homestead exemption must be filed between January 1^st and April 30^th of the tax year.

Why does the homestead exemption matter to you?
As filing is free and it lowers your property taxes, the homestead exemption can only benefit you as a homeowner!

Have a question? Reach out to us anytime:

Phone: (970) 627-7392

Email: tmcneil@kw.com