Pat Guseman, Ph.D. and CEO, Population and Survey Analysts
To estimate future students moving into any school district, it is helpful to understand the differential growth of the millennials versus those in the child-rearing stages of the life cycle — and also versus the baby boomers. The latter are getting much attention in the Austin Metro Area, because at least one study by Ryan Robinson (City of Austin demographer) has shown that those 55-64 were increasing at a faster rate in the Austin metro area than any other metropolis in the nation. And, the same study indicated that those 65 and over in the Austin area showed the 2nd highest in percent increase relative to other metro areas in the U.S.
Population and Survey Analysts (PASA) works with several western area school districts – and has selected the three that had the Census Bureau’s American Community Survey undertaken in 2007 or 2008 – Leander, Lake Travis, and Dripping Springs. This 2007 or 2008 data was compared to the latest American Community Survey data from 2017.
Age segments were the interest in this trend analysis – because PASA often needs to determine how many of the new homes in a school district are going to be purchased by baby-boomers versus those with school-aged students versus young millennials with no children in school. While we do not know specifically the number purchased by each of these groups, we can follow growth patterns of each age segment,, and reach conclusions about the homebuying practices of these three groups.
Because the 55-64 age group has different relocation patterns than do those 65-plus, we have termed the 65-plus as baby boomers in this article. Likewise, the millennials are actually23 to 38 or 39, but we have used the Census category of 25-34. Finally, the child-rearing stages are categorized as ages 35-54, and student-aged population as 5-17 (again, following the Census Bureau categories available to us).
The graphs below show the impacts of the varying growth patterns for these age groups over the past nine or ten years. Lake Travis and Dripping Springs have been significant magnets for those 65 and older. All three districts had well over 100% increases in that age group. Those in the child-rearing stages had less than half the percent increases as did the “boomer bulge” in the three districts. The millennials also had less than half the percent growth as the boomers, with Dripping Springs I.S.D. actually losing millennials in the nine years for which data was available.
Not only are baby boomers are racing to buy homes in suburban Austin districts, they typically have a higher disposable income relative to other homebuying segments. PASA has calculated that the median price of homes purchased in 2018 for the three school districts, using the Austin Board of Realtors data. Generally, the median sales prices for homes in those districts are higher than the Austin area’s.
Dripping Springs I.S.D. had a median sales price of $492,500 in 2018, Lake Travis I.S.D. $541,500, and Leander had $387,478. Leander I.S.D.’s median price is less than the Austin area as a whole, which was $457,500. However, even in the Leander School District, the highest priced new homes are in the master -planned community of Travisso, which is heavily oriented to empty-nest, older households.
Three conclusions emerge:
• Buying a home is more costly in these suburban areas than has stereotypically been described.
• These west Austin fringe school districts appeal to older buyers (as can been seen in the “growth graphs by age group” for the three school districts).
• Finally, these empty-nesters have a greater financial ability to purchase new and resold homes.
Since the baby-boomers will be heavily impacting these school districts, it is important to note that this “boomer bulge” is not likely to last longer than ten more years. And, most production builders have already been vying to attract millennials — building more affordable homes in suburban locations – Lennar with its nuHome line, Pulte with Centex (now an entry level product), DR Horton with its new Express subsidiary, and others. These entry-level homes may be on 40- and 45-foot wide lots, and are 1,100 to 1,900 square feet, in order to stay under the $200,000-price tipping point.
The parents of school-aged children in this equation are sandwiched in between these boomers and the millennials. They typically need larger homes on larger lots, so that they pay more than entry level prices. In sum, many parents are led to purchase older homes — and perhaps may avoid the high growth, high-priced homes in school districts on Austin’s western fringe.