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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsPlunging Home Prices, Fleeing Companies: Austin's Glow Is Fading
Plunging Home Prices, Fleeing Companies: Austins Glow Is Fading
(Bloomberg) -- Oracle Corp. is moving its headquarters out of the city. Tesla Inc. is pulling back after a rapid expansion. Almost a quarter of commercial office space is vacant, and nowhere in the country have residential real estate prices fallen further from their pandemic peak.
Austin, the cosmic cowboy paradise that became a Covid-era economic superstar as it lured Elon Musk and a host of California refugees with its low taxes and sunny weather, had become accustomed to a steady drumbeat of good news. But lately thats changed. And on Tuesday, Larry Ellison announced that his software company will shift its headquarters from the Texas capital to Nashville, Tennessee. It was a brief marriage Oracle only arrived in Austin in 2020 but getting jilted is never easy
City Hall was as surprised as everyone else, Mayor Kirk Watson said in a statement.
But maybe he shouldnt have been so shocked. Austin has been going so strong for so long that the tide was bound to turn.
After a 12-year streak as the fastest growing large metro area in the US, Austin lost that slot in 2023. An office glut has pushed the vacancy rate 5 percentage points higher than the US average, according to data from Colliers. Home prices have dropped 18% from the pandemic highs seen in May 2022, the most among the 50 largest US metro areas, Redfin data show. Even so, the city ranks as one of the least affordable housing markets
https://www.msn.com/en-us/money/markets/plunging-home-prices-fleeing-companies-austin-s-glow-is-fading/ar-AA1nFgrS
Sky Jewels
(7,155 posts)because although Austin a liberal oasis, its still in Abbotts Texas. Many young women dont want to endure a Handmaids Tale regime.
viva la
(3,322 posts)Young people in a state where basic medical care is limited by law.
yardwork
(61,712 posts)Im pointing out that the woman-hating atmosphere and laws in Texas are not helping Austins plight in general. Oracle isnt the whole story here.
genxlib
(5,542 posts)When you start a relationship as a mistress, the cheating bastard will keep looking even after making a "commitment" to you.
LeftInTX
(25,595 posts)yardwork
(61,712 posts)He's not moving his company because of politics, I assume.
hlthe2b
(102,411 posts)(and their employees)? Texas has become corporate unfriendly in nearly all ways except for lack of income tax.
And no, the increasingly regressive politics of Tennessee do not escape me but (apparently) are not a bother to Oracle... And Nashville has a similar overpriced housing issue. And the Tennessee legislature is increasingly trying to destroy any independence for Nashville and Memphis. Sheesh. It seems to me one bad move for another.
LeftInTX
(25,595 posts)I know Humana is in Kentucky
NanaCat
(1,301 posts)But Austin has a bunch of strikes against it. The housing market has been riding a bubble for a very long time that was due to burst.
The transportation situation is atrocious. The traffic there is as bad as LA, and the city can't do much to change that at this point.
Sure, there's no state income tax, but the property taxes alone often make other states' income+property taxes look like a bargain. Taxes and fees on obscure services are also rampant--and almost always grifter high. It ends up being as expensive to live in high-COLA Texas cities, tax-wise, as it is in places with state income taxes. And sometimes, it's more expensive. A lot more.
If that's not enough, now major corporations must be having a difficult time recruiting and retaining employees thanks to the Texas GQP war on women. No matter how liberal it claims to be, Austin is not exempt from abortion being effectively illegal in the state, you know.
Maybe that's not such a big deal at techbro companies like Oracle or Tesla...but it will be a big deal for the working wives of any Oracle or Tesla employees or potential recruits. Every woman with a brain is thinking, 'sure, we'd probably make enough for me to leave the state for an elective abortion, but what if I have a pregnancy that goes bung? What happens to me then?' And they do not like the answer they see playing out in the real world of emergency obstetrics in Texas.
That's going to cool recruiting and retaining the best workers, and not by a small amount. I think the big companies there are already hurting from that sexist policy, and the employment woes will only become worse as time goes on. Sooner or later, they will have to cut their losses and move to bluer lands, or risk falling behind to competitors in civilized states.
So it's not a surprise that Austin is starting to lose its luster.