What 2022 holds for Williamson County housing market

The history of Williamson County can be seen in its housing. The same goes for its future.

The less dense northern neighbor of Austin has long been a prime destination for new housing development. Large communities of detached single-family homes are rising all over the county as the population wave disperses throughout the metro — and as land prices in the urban core push projects farther afield. At the same time, plans for dense mixed-use communities are proliferating, even in small towns where such development has largely been absent, such as Hutto and Taylor.

To put it succinctly, Williamson County continues to grow fast, and that growth is changing the county.

That has big implications for developers and builders, but will also impact professionals from Realtors to retailers, technology executives to school administrators. Here are some of the biggest trends shaping the housing market north of the capital city.

Rising prices

Of the Austin metro’s five counties, prices are rising fastest in Williamson: the median home price jumped more than 33% year-over-year to $430,000 in October, according to Austin Board of Realtors data. That compares with a 22% climb in Travis County. The metro as a whole saw prices increase about 25% in the same time frame.

Meanwhile, Williamson County’s inventory is lowest in the metro, at 0.8 months.

Susan Horton, 2021 president of ABOR, expects a continued uptick in those median prices. Just how much it will increase is anyone’s guess. For the wider Austin metro, Realtor.com recently predicted that housing prices will rise 3% in 2022. That would be rather muted compared with the 18.5% increase from January 2020 to January 2021.

However, other market watchers expect steeper increases next year — perhaps again in the double-digit percentage points.

Also in short supply is the kind of luxury housing that will appeal to the executives of the large technology employers moving into the area. For homes priced at $1 million or above, ABOR reported 2.5 months of inventory in Williamson County in October. That compared with 10.5 months a year prior.

Horton was recently helping a client search for high-end homes, and when looking at $2 million-plus properties in Williamson County that fit his requirements, there were only five on the market.

“That upper end is suffering because the inventory is just not there,” she said.

Rising housing prices also present one of the biggest challenges for Williamson County. While homes are still generally cheaper than in Travis County, the gap is shrinking. Williamson’s median price of $430,000 in October was just 6% lower than the metro-wide median of $455,000, according to ABOR.

In October 2019, the median price in Williamson County was $295,000, versus a metro-wide price of $327,500 — a difference of 11%.

Horton said the growing number of active listings in the county and new development could help on this pain point.

Williamson County is also seeing more development of communities specifically geared for people with less-than-average incomes. The NRP Group LLC broke ground earlier this year on a 275-unit affordable apartment community, in southern Round Rock near the intersection of the Mopac Expressway and State Highway 45 toll roads. Minnesota-based Roers Companies is building a 300-unit affordable community called The Narrows Apartments in Hutto.

Still building big

Williamson County is fertile ground for large master-planned communities. Santa Rita Ranch in Liberty Hill was the top-selling MPC in the Austin area in 2020, with 641 sales, according to real estate consultancy RCLCO. The firm reported that out of the eight top-selling MPCs in the metro last year, six were in Williamson County. That ratio held steady through the first six months of 2021.

There are communities planned to reach at least 1,000 homes in every corner of the county. New ones getting off the ground now include the 1,600-home Lariat in Liberty Hill, the 1,000-unit Parmer Ranch in Georgetown and the 1,300-home Emory Crossing in Hutto.

Grant Rollo, vice president of Lariat developer Randolph Texas Development LLC, said homebuyers are attracted to Williamson County’s strong schools, family amenities, “traditional Texas” values and natural beauty. That is why Lariat is designed with seven miles of trails along a creek that drains into the North Folk of the San Gabriel River.

Randolph Texas Development in 2015 purchased an old ranch that it turned into the high-end Northgate Ranch neighborhood, which it is now closing out, and the forthcoming Lariat. They always expected the communities to do well but sales “exploded” during the pandemic, as many people looked for larger homes and the rise of remote work ended the practice of commuting five days a week into downtown Austin. The second section of Northgate Ranch, 47 lots that went up for sale in November 2020, sold out in “about 20 minutes,” he said.

“The thing that’s just amazing being on the development side … is how excited people are to live out here,” he said. “Williamson County’s become a destination.”

Horton echoed Rollo’s reasons for the county’s appeal and said it is also a magnet for first-time buyers and young families, although that could be threatened by rising prices.

For the 12 months that ended with the third quarter of 2021, there were 12,121 housing starts in Williamson County, according to residential data provider Zonda — nearly double the 6,876 starts in Q3 2018.

Intense housing development has always been in the cards for Williamson County. The acceleration of the Austin-area economy has for roughly a century pushed the built environment out further from that city’s urban core.

But growth could be accelerated even further by increasing mixed-use development, which is adding density and even more jobs to Williamson County in a powerful feedback loop.

Mixed-use density

The county has seen a handful of major mixed-use communities announced in recent years. 2022 will be the year many get off the ground.

Construction is expected to start soon on the first residences in Northline, a 116-acre project in Leander. Groundbreaking is expected in 2022 on Bell District, which will create a commercial hub with apartments in Cedar Park. Infrastructure work is well underway on Wolf Lakes Village, which is set to bring hundreds of multifamily residences, offices and retailers including H-E-B to 164 acres in Georgetown. Milhaus, an Indianapolis-based company, is moving ahead with plans for a 110-acre community featuring multifamily residences, townhomes and more just west of the Kalahari Resort in Round Rock.

Smaller-scale developments are even popping up on the edges of the metro. Dannen Development LLC has proposed a 39-acre community on the north side of Taylor: Preliminary plans for Trenton Village include 80 townhomes and 118 duplexes, plus parks and about eight acres of commercial space. Athena Domain Inc., a San Antonio-based developer, in July received rezoning approval for Berry Creek Crossing, a low-density project that could produce 650 multifamily units and up to 17 acres of commercial space on the site of an abandoned recreational vehicle park in northern Georgetown.

Dustin Slack, the newly named vice president of development in Texas for Milhaus, said city halls and community members can help shape plans for these kinds of communities. He said it behooves developers to really listen to a community’s needs — whether that be medical care, restaurants, multifamily dwellings — before finalizing plans. But there is no stopping the outward march of mixed-use development.

“You’re going to see more of these types of holistic developments, where sites will have residential and commercial components,” he said. “Then the discussions with the city is, how do you get them all to work together, to play together? How do you create a pedestrian focus, which has typically not been a suburban idea?”

Courtesy of Austin Business Journal. See the full article here.