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Austin Market Defies U.S. Economic Drought

“Thriving” is a word commonly associated with Austin. While most of the country has wrestled with recession, job losses and housing angst, Austin has been riding a wave of economic well-being. Read more on Inman News.

When Win Butler, lead singer for the indie rock band Arcade Fire, took the outdoor stage at the recent Austin City Limits Music Festival in Texas, he told the audience, “I don’t know if we’ve ever prayed for rain before at a festival, but we are this time.”

The sentiment is an entirely serious one in Austin, where a long-running drought, followed by literally thousands of wildfires, has cast an economic shadow in a region that hasn’t had a whole lot to be anxious about in recent years.

“Thriving” is a word commonly associated with the city. While most of the country has wrestled with recession, job losses and housing angst, Austin — along with the rest of Central Texas and even the state as a whole — has been riding a wave of economic well-being. Companies are hiring. The population is growing. And real estate — if not exactly booming — is stable.

“We’re in a good place,” said Mark Sprague, director of business development for Mission Mortgage in Austin, in a forecast to a group of real estate and lending professionals in August. Sprague said the local housing market had bottomed out, and that the economy is outperforming the nation as a whole on several fronts, according to coverage of his speech by the Austin American-Statesman.

Examples of those robust fronts:

  • the Rice University Kinder Institute for Urban Research in July placed Austin as the 11th fastest-growing city nationwide by having added nearly half a million residents in the past decade, and predicted the metro would add 6,000 residents just between July and August of this year;
  • the Federal Reserve Bank of Dallas has predicted that the metro area would add 7,000 to 11,000 jobs in 2011; and
  • the city of Austin this year earned AAA ratings on its bonds from the three leading ratings agencies.

Besides being a hub for health care and pharmaceutical companies and a history that long has been built on cattle and agriculture, some of the “why” behind Austin’s growth stems from the double presence of the state government and the 50,000-student campus of the University of Texas. Both are major employers, and the university churns out large numbers of well-educated graduates each year.