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Hays County foreclosures still rising, but more slowly


Hays County’s meteoric rise in foreclosures may have slowed in 2010, but it didn’t stop altogether.

This year, 1,579 properties were listed for auction on the steps of the Hays County Courthouse, a 3.8 percent increase over the 1,520 properties posted in 2009.

The final auction of the year, held Tuesday, saw 146 homes posted for auction. Many of the listings were concentrated in affordable subdivisions such as Shadow Creek and Indian Paintbrush, but upscale and high-dollar homes in Ruby Ranch and Belterra also faced the auction block.

As the American housing crisis deepened into recession, foreclosure rates shot up across the nation, and Hays County was no exception. In 2008, just 970 properties were listed for foreclosure, representing an average of 81 per month. Over the course of 2009, those numbers shot up 57 percent, to a monthly average of 127. This year saw 132 listings per month, including an all-time high of 160 in March.

Foreclosure listings in 2010 likely would have been higher without interventions such as the federal Home Affordable Modification Program (HAMP), said Buda realtor David Aston, who specializes in foreclosure sales.

“They’re doing everything they can to slow down or stop the foreclosures,” Aston said. “They’re really holding off and they’re doing a lot of loan modifications to try to keep those loans from going to foreclosure.”

Though foreclosures have increased, housing prices in Hays County were never significantly over-valued, and as a result they’ve held fairly steady, Aston noted.

“We’ve never really seen a real big bubble that burst,” Aston said. “We had nice, slow and steady increases. Fortunately we haven’t seen any sharp declines, but we have seen some slow declines.”

Marilyn Van Uum, a Buda sales executive for Gracy Title Company, agreed with that assessment.

“Hays County is much more affordable than many other areas,” Van Uum said. “I think that’s the reason why we’ve seen some dropping in home prices, but not to the degree that you would see in other areas.”

The Multiple Listings Service (MLS) breaks Hays County into four real estate regions, including San Marcos, Wimberley, Dripping Springs and Buda/Kyle.

In the most recent data from October, home prices were down slightly Buda/Kyle area compared to the same month from the year prior. This October, the average selling price was $164,412, down 3.9 percent from the average selling price of $171,165 in 2009. The median sales price was $150,000, down 2.9 percent from the median of $155,000 in October of 2009. By contrast, the average selling price was $183,123 near the peak of the boom in January of 2008.

The average days on the market nearly doubled in that time period, from 48 days to 93 days.

Some of those increasing numbers of foreclosures may simply reflect the skyrocketing growth of the Hays County population as a whole, especially in the eastern IH-35 corridor. Kyle’s population was estimated at about 11,600 in 2003, and now may number as high as 32,000. Hays County was estimated at 116,000 in 2003, and about 155,000 by the end of 2009.

The growth in Kyle was especially concentrated in the first half of the decade, exceeding 20 percent in every year from 2000 – 2005. Many younger couples flocked to the inexpensive starter home subdivisions of Kyle and Buda, where they could find a new three bedroom home with a yard for as little as $130,000, well below the prices in neighboring Austin.

Unemployment in the greater Austin area is now 8.1 percent, below the national rate of 9.8 percent, but still elevated over pre-recession levels.

“A lot of the foreclosures we’re seeing were typical first time homebuyers, and a lot of these loans were USDA or subprime, where everyone got in for little or no money down,” Aston said. “Any hiccup in their employment situation is going to have a severe impact on their financial ability to pay for that mortgage.”

Some observers, such as Van Uum, think the market is on its way to improvement.

“It seems like after the election, boom, things started picking up again,” Van Uum said. “The market has definitely improved. I think a little bit of confidence is back.”

However, there may still be some rocky times ahead, Aston noted, as many troubled mortgages haven’t even entered the listing phase.

“It’s going to take flushing all of those out,” Aston said. “All of those foreclosures are going to have to go through the system before we can come back to some normalcy in the market. A lot of [the loan modification] is really just delaying the inevitable. It’s a band-aid effect.”

Right now, the market in Hays County favors buyers, Aston noted, with a large housing inventory, some declines in pricing, and historically low interest rates. But on the flip side, even well-qualified buyers may face difficulty or long waits to secure financing,

For residents trying to sell their home, Aston said it’s essential to price it competitively from the start, and make sure it’s in top-notch condition.

“If you’re trying to sell your home right now, keep in mind that you’re in a very competitive market,” Aston said. “There’s a lot of homes for people to look at.”