People often ask about new home prices in Austin. Everyone wants a way to project a budget for their project. Unfortunately, there are no standard prices, as every project is different. Recently, however, the Austin Business Journal published some average pricing based on information provided by the Texas Association of Realtors. Even though these prices look back over last year and don’t take into account that current pricing has to look forward (as it takes 10-12 months to build a custom home), it does provide some insight into Austin’s custom home pricing.
Over the past five years, luxury home pricing has increased, and 2017 was no different. “Despite slowing growth trends across the Texas housing market, job market and economy in 2017, Texas luxury home sales volume has continued to grow at a booming pace,” Vicki Fullerton, chairwoman of the Texas Association of Realtors, said in a statement. “Rising home prices, high-end remodeling activity in major metro areas and relocation activity from out-of-state residents all continue to be drivers for Texas home sales of $1 million and higher.”
According to the Texas Luxury Home Sales Report, released Dec. 14 by the Texas Association of Realtors, 868 sales of single-family homes priced at $1 million or more in the Austin metro area were up nearly 21 percent from the same period a year earlier. Those sales made up 11.8 percent of all listed home sales.
New Home Prices per Square Foot
The Journal reports that the average price per square foot in Austin for luxury homes sold in the past year was $452 per square foot. This puts the median size at 3,493 square feet.
Price increases in the custom home sector in Austin have been influenced heavily by labor shortages and increased material cost. While more and more people move to Austin every day, trade contractors and skilled labor have not kept pace. Hurricanes and strong housing throughout the country have kept labor growth at a modest pace. Add to that the increase in material cost, and the result is the steady increase in custom home pricing.
How Design affects Prices
The primary factors affecting new home prices are not style and colors but rather material and architecture. That is why we integrate the design team into the process (via in-house design) and have done so for many years. Designing to the budget of the client allows the overall project to maintain a cohesiveness from the very first day. Instead of “upgrading” just the items that the client specifies, the entire home is considered in terms of the budget. With literally thousands of options, there is simply no way to standardize custom home pricing. There are “good/better/best” options and even some bad options for our climate and soil conditions. For an example of how design affects pricing, see our article on How to Compare Pricing. Even within the “best” options, some options don’t work well with others. That is why it is so important to consider budget before a single line is drawn on the page. With a design and construction team working side by side from day one, the budget can be a reality and the end result is a better design.