Critics of Austin's current system of city-wide Council elections are correct that Council elections are dominated by a "white, liberal, central city power base" a/k/a central Austin homeowners. I think this is a bad thing. Central Austin homeowners are a parochical lot and they elect parochial Council members who adopt policies that stifle new housing and development and run up the price of existing housing. Central Austin has fewer residents, more expensive housing, and lower-quality housing than it should have, thanks to a system dominated by central-city voters.
And I will support an alternative system as soon as someone proposes a better one.
From where I sit, parochialism is the City's principal problem. Single-member districts are not a cure for parochialism. On the contrary, they institutionalize parochialism. A Council member whose district will be affected directly by a particular vote will have an incentive to consider only the effect on his or her district, rather than the broader harm or benefit to the City as a whole. Council members whose districts will not be affected directly will have an incentive to defer to the affected Council member; they will want and expect that deference to be reciprocated. That is the genesis of "ward courtesy."
SMD proponents argue that city-wide elections are corrupted by money, but it is the SMD system that is prone to corruption. In a ward courtesy system, you only need one vote for zoning changes as a practical matter. That makes corruption a more feasible proposition, both economically (fewer people to buy off) and logistically (fewer people on the take means less chance of getting caught). And for those who really believe that money has been buying Austin's elections, note that switching to single-member districts will make elections cheaper to buy. SMDs won't rid politics of money; they'll just stretch the money a bit farther.
If someone can convince me that Austin won't degenerate into ward-based politics, I'll switch my support to SMDs. I'd like to see a larger Council representing more diverse viewpoints. But I don't like the incentives created by single-member districts, and I think incentives are a better predictor of the system we'll get than banal assurances that our new Council members will act for the common good.