Austin is an odd bird in the Texas aviary of real estate, both commercial and residential. The Austin Business Journal is reporting that commercial and residential contracts combined are down almost 50% through August of this year over last year, which itself was not a stellar year.

That blowing sound you hear could be the air coming out of the Austin real estate market. I'm a bull when it comes to Houston area real estate, a serious bull, but with Austin... not so much. Austin has long been known - for decades - as a kind of "oasis" in the middle of an otherwise heavy Texas culture dominated by rural and libertarian-populist down-home common-sense outlooks. Austin? Well, that's where Willie Nelson lives. That's where the nude beach is on Town Lake and where Whole Foods was born... before it went all "corporate." That's where the forever-young go to study, grow old, and retire. But in the past 10 years? It's become in my view more west coast than west, including the real estate dynamics.

Those real estate dynamics, paralleling west and east coast escalations in recent years, may have a darker path through recovery than the more tamed markets of its sister cities like Houston and San Antonio, the coast, and Brownsville.

From the article:

The number of new contracts issued on future nonresidential and residential construction in the Austin area fell are down 48 percent in the first eight months of this year compared with the same period in 2008, according to the latest research from McGraw Hill Construction.

The firm reported that the total value of future construction contracts so far this year reached $1.7 billion locally, down from $3.2 billion a year ago.

That's a lot of deflating. And it may not be bad. Could Austin be finding its down-home roots again? It's college town progressive gorgeous and youthful charm? It's hard to have youthful charm when its skyline is being radically revised by residential skyrise complexes like the ridiculously "austentatious" Austonian, shown here lording over a once-charming Austin skyline in a rendering if it ever gets complete.

Seriously. Seriously. Who's going to live there? Professors from the many colleges in Austin? Graduate students in their 10th year of dissertation writing? If not, then who? The answer starts to unwind the story of Austin and its economy over the last 10 to 15 years.

But it's not at all clear that The Austonian will find the occupancy its developers (and their financiers) once bet upon.  Word on the street is that the developer is not releasing its "presales" figures, the measure by which any residential development, especially skyrise, can reveal true market momentum.

A few years ago I thought that the Frost Bank skyrise, which my sister and her family can actually see from their front yard,  ruined what was once the charming skyline of Austin that spoke to a different timelessly classic time and to the unique nature of Austin's character. Here it is in all its... whatever:

Now it's just another skyrise lost in the mix of others built since and... residential skyrises desperate to find residential buyers (and increasingly, renters). A friend told me she jokingly calls it "The Panasonic Building" because of its likeness of a Panasonic nose hair trimmer. It's funny because it's true (I have one of those trimmers).

Anyway, the stats are telling us that Austin is starting to deflate, or rather has been deflating all year. As someone who lived in Austin for a number of years and fell deeply in love with the city and its unparalleled unique character in America, I hope Austin doesn't suffer, and I hope it rejuvenates its old soul through the recovery in the months to come.  I may not be a bull on the Austin market, but I am sure rooting for it.