Economic Growth Slowing

The Austin area economy is slowing according to the most recent Dallas Federal Reserve report. DallasFed Georgetown is part of the Austin metropolitan statistical area and should be exercising caution with respect to spending so that there are no "unexpected" surprises.


"The Austin economy slowed slightly in August. Growth in the Austin Business-Cycle Index has steadied over the last two months but remains well below its long-term trend. The unemployment rate increased for the third consecutive month, although it held below other large Texas metros. Jobs declined in August for the first time since March 2016."

The Austin–Round Rock metropolitan statistical area (MSA) encompasses Bastrop, Caldwell, Hays, Travis and Williamson counties.

Here are a couple of relevant charts.

"The median home price for Austin rose for the third consecutive month in August to $283,667. This contrasts with the median price for Texas homes, which increased only slightly to $210,171. Year over year, Austin home prices have appreciated at an 8.9 percent rate, compared with 6.4 percent for Texas, and Austin’s median home price remains the highest of any of the major metro areas within the state. Home inventories have held at 2.4 months’ supply for the last three months, well below the six months’ supply generally considered to be a balanced market."

This chart shows two significant characteristics affecting Georgetown. First, housing is becoming less affordable for the average Texan. Second, property taxes are becoming an unsustainable burden on property owners. As property owners know, it's not the tax rate that matters, it's the annual property tax payment that matters!

"Austin job growth has been uncharacteristically weak this year, as softness in professional services, leisure and hospitality, and health care has dragged on overall hiring. Historically, Austin adds jobs at a significantly faster rate than Texas. However, a steep decline at the beginning of this year pushed Austin’s six-month annualized growth rate slightly below that of Texas for the first time since 2010. Recently, Austin jobs have recovered slightly to 1.7 percent in the six months ending in August."