Austin Real Estate

As Austin Develops, Should We Protect All 35 of Austin's Capitol View Corridors?

What is a “Capitol View Corridor” and why are these corridors so important to building development in Austin, Texas?  Ever since the Texas State Capitol was created back in 1888, there has been a city initiative to protect and preserve the views of the Capitol from various viewpoints around the city.  Capitol View Corridors are a series of legal restrictions on construction in Austin aimed at preserving the visibility of the Texas State Capitol. This is a common practice in many state capitols, and most strictly enforced in our nation’s capitol, Washington D.C..

 In 1931, the city of Austin decided that no building within a particular zoning ordinance would exceed 200 ft.  This rule would maintain views to the capitol building and emphasize it as one of Austin’s most important structures. 

Over the years, however, the city flexed from time to time, allowing exceptions to this 200 ft rule as long as the buildings maintained a certain setback or stair-step effect that still allowed capitol views.  If you look at some of our main corridors along Congress Avenue or Lamar, you will notice some of these unusually shaped buildings that had to make adjustments to maintain a clear capitol view.  In response to the historical bending and flexing of the city rules, a state statue was passed in 1983 that established an official “Capitol View Corridor” in Austin, TX.  All buildings built within this corridor would now undeniably have to follow state regulations.

History of Cap View Corridor.png

If we count all the views protected by both the city and the state, there are 35 Capitol view corridors today. Some are just a few city blocks while others, are extremely long, like the corridor that goes out to the 360 bridge.

map courtesy of ftp.austintexas.gov

map courtesy of ftp.austintexas.gov

Today, as development is at a premium in downtown Austin, there has been much discussion if all 35 viewpoints of this capitol corridor still need to be protected today. What is your opinion? Do you think it is important that the city & state maintain a Capitol View Corridor? Should the Texas State Capitol remain the centerpiece of Austin’s skyline? As development pressure increases, time will only tell how many “exceptions” or “revisions” will be made to these state statutes in the future. But for now, enjoy those views of the dome and the goddess of liberty that you see from over this beautiful city.

Part 2 - 33.3% Return on Renovation

If you missed Part 1, click HERE to read about a 46.7% return on renovation of a condo.

As previously mentioned, I have been fortunate to work with sellers who want to maximize their return on their home. In doing so, we put together a plan to renovate their home, then list their property for sale. This approach is risky, takes capital, and patience from the home owners. But in the right urban situation, with the right team, the opportunity can create a ROR (return on renovation) of 30-100%.

A key to this equation is who will do the renovation? My wife, Diana Skellenger, is a female general contractor in Austin. For all my sellers, the only contractor I trust is Diana and her team at skellyhome.com. Skelly Home continues to lead the pack in quality, affordable construction. I must admit, I am on the team, but it's from a high level. :)

The second example is a home in Travis Heights. This home was purchased by the owners in 2005. Before the renovation, the home was worth $600,000 and looked like the following:

For this home, the plan was to renovate the entire home which included a kitchen, 2 bathrooms, wet bar, removing a load bearing pantry (seen in the top left photo), and paint the entire exterior.  The total budget for the renovation was $120,000 with a market price of $825,000. 

Yes, this is the same house. The renovation turned out as expected, outstanding! The home was listed, then sold for net $760,000, earning a return of renovation of 33.3%.

Math:

$760,000 - $600,000 = $160,000 Gross Gain on Renovation

$160,000 (Gross Profit on Renovation) - 120,000 (Renovation Cost) = $40,000 Net Return on Renovation  

$40,000 (Net Return on Renovation) / $120,000 (Renovation Cost) = 33.3% Return on Renovation

The Renovation approach can work with the right team. 

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Part 1 - 46.7% Return on Renovation

Typically, your home is your biggest investment. Over time, a home owner not only creates long lasting memories in their home, but also can grow significant equity at the same time. Once you grow out of your home or want to move neighborhoods, it's time to capture that equity or return.

I have been fortunate to work with sellers who want to maximize their return on their home. First, we put together a plan to renovate their home, then list their property for sale. Now, this renovation approach does not fit everyone. It takes risk, capital, and patience from the home owners. But in the right urban situation with the right team, the opportunity can create a ROR (return on renovation) of 30-100%.

A key to this equation is who will do the renovation? My wife, Diana Skellenger, is a female general contractor in Austin. For all my sellers, the only contractor I trust is Diana and her team at skellyhome.com. Skelly Home continues to lead the pack in quality, affordable construction. I must admit, I am on the team, but it's from a high level. :)

Part 1 - Return on Renovation of 46.7%

The first example is a condo. At the time of the sale, the condo was worth $225,000 and looked like the following:

For this space, the plan was to renovate the entire condo which included a kitchen, 2 bathrooms, removing a load bearing wall (adding a column for support) and creating a better storage solution in the current utility room (white pantry next to the kitchen and half bath).  The total budget for the renovation was $75,000 with a market price of $365,000. 

As you can see, the renovation turned out to be amazing. The condo was listed and sold for net $335,000, earning a return of renovation of 46.7%.

Math:

$335,000 - $225,000 = $110,000 Gross Gain on Renovation

$110,000 (Gross Profit on Renovation) - 75,000 (Renovation Cost) = $35,000 Net Return on Renovation  

$35,000 (Net Return on Renovation) / $75,000 (Renovation Cost) = 46.7% Return on Renovation

The Renovation approach can work with the right team.