Over the last 2 years, builders have put the brakes on new housing starts in response to the mortgage meltdown, but they may have over-shot the mark. They went from building 18,000 new units a year in the Austin/Round-Rock area to only 8,000 this year.
At the same time, people continue to flood into Central Texas at the rate of about 42,000 a year. Increased population means increased demand for housing. Less new homes mean tighter supply. High demand and low supply is a recipe for upward pressure on prices.
(Article published at ImpactNews.com. Read it here.)