The booming real estate market in Austin, TX, specifically the West Campus area, is in for a big surprise and relief in the coming fiscal year! Although property values are still increasing, the tax rate continues to decline.
After dropping 0.20 percent this year, the city council is expecting the tax rate to drop an additional 0.70 during the 2014-2015 fiscal year. The reason for this tax rate decline is the simple fact that property values are still increasing! According to Austin City Manager, Marc Ott, his team has been “instructed to develop an expenditure and revenue forecast with focus toward keeping the property tax rate flat.” They have actually been able to top that task and decrease the tax rate itself!
Since 2007, the tax rate had been on a steady increase each year. Although this new lower tax rate is a welcome site to most, it’s not going to be beneficial to everyone. Because property rates are still on the rise, those living in West Campus can expect rents to rise yet again. The reasoning for this is simple supply and demand.
Many people are moving to the West Campus area for work and/or school. The University of Texas at Austin is a highly sought after school. At the same time, Austin is an excellent city for graduates and experienced workers alike. The opportunities here are unlimited. This creates a large population of people in a relatively “small” pond of housing options. To compensate for the growing population, many new properties are being developed. However, in the meantime, the supply and demand is coming to a head.
That being said, with the increased property values, we can, for now at least, take advantage of the lowered tax rates. Who knows how long it will last? This doesn’t happen too often so we may as well enjoy it while we can!