Austin American-Statesman writes, "Austin's boom is far from over, as a new report says the metro area has the second-fastest-growing economy in the country.

Austin's estimated regional gross domestic product — the total value of goods and services produced in one year — increased by 4.3% this year, second only to San Francisco's growth at 4.8%, according to the Kenan Institute of Private Enterprise at the University of North Carolina.

The report is the institute's first as a part of its American Growth Project, which aims to provide "up-to-the-minute" economic data for the microeconomies of towns, cities and counties across the country.

Hoping to help government officials and community leaders understand real-time industry trends, forecasts and labor issues, the project is keen on identifying why economies in some areas are contracting as others nearby expand.

The full-year GDP numbers for 2022 include estimates for the fourth quarter, which has not been completed yet. The report's authors write that "our estimates may not align with national fourth-quarter to fourth-quarter GDP growth, which is likely to be meaningfully slower than the yearly national figures."

Equating to $216 billion, Austin's GDP ranks as the 22nd-largest in the country, according to the report. And while cities like New York, Los Angeles, Chicago and Dallas have larger GDP outputs, only Austin and San Francisco grew by more than 4% during the year, with Seattle coming in third at 3.5%, according to the report.

"The growth of tech appears to be a major driver of economic expansion in the fastest-growing extended metropolitan areas," said Gerald Cohen, chief economist at the Kenan Institute. "The list is topped by San Francisco, Austin and Seattle, all major hubs for software development."

Citing the growth of tech giants Oracle, Tesla, Google and Amazon in Austin, the report points to continued favorable conditions in the area for growth with a "high concentration of venture capital, warm climate and vibrant cultural offerings."

In addition, Samsung's efforts to invest in the area, along with a growing push to increase microchip manufacturing in Central Texas, create potential for continuing economic and industry growth.

Meanwhile, the institute cites data from Zillow, a real estate industry website, showing Austin has experienced similar changes to its housing market as those seen during the tech boom in the San Francisco Bay area. According to Zillow and the institute, the median home value in Austin increased from $349,156 in August 2020 to $566,479 in August 2022.

Austin's housing market, however, has settled back to "more normal" conditions in recent months after historic highs in demand and price, thanks to fewer sales and slower price growth, according to market experts.

“Homebuyers have not had this much leverage and this many options in over a decade,” said Cord Shiflet, president of the Austin Board of Realtors. “We’re still in a seller’s market, but as homes take longer to sell and are being bought for less than the original list price on average, and with inventory steadily increasing, right now is a great time to be a homebuyer in Central Texas.”

Experts say, however, that Austin's housing market should keep humming along due to job growth in the region.

"We have seen businesses relocating to the area at a historic rate; in fact, most of those employees who will work at those businesses have not even moved here yet, and that is not going to slow down," said Garrett Beem, lead agent of the Beem Team with Coldwell Banker Realty in Austin."


Source: Austin American-Statesman

Written by: Hogan Gore

Published: October 20, 2022

Posted by Grossman & Jones Group on


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