Play it any way you like it but Austin is not in a real estate bubble. Its property market is encouragingly poised. Housing demand is just where you would like to see it and inventory is pretty stretched. While the Austin market is not as big as Houston or Dallas, it has witnessed a near 100% spurt in home prices over the last 10 years.
Austin Board of Association of REALTORS data
Based on data plucked from the Austin Board of Association of REALTORS, HomesUSA.com has conducted an analysis that says new homes sales were higher in Austin in September despite the average price of homes increasing a notch. The rolling 12-month average for September was 723 in comparison to 721 that Austin had registered for August.
To reiterate, worth noting is the trend that the number of homes sold in September was higher despite an increase in prices. The average price of homes for sale in September was $369,849 compared to $368,714 in August. That’s a $3 rise for every $1,000!
Even from the perspective of Days on Market (DOM), September’s 111 days was an improvement on August’s 111.9 days. For the record, statewide DOM for September was 119.47.
Pending New Home Sales Index, reveals HomesUSA, also posts a heartening story. Down to 644 from 686 over the August-September arc, clearly demonstrating that closing home transactions hasn’t been difficult for buyers.
Austin Metro spread over the five counties, witnessed 2,654 single-family home sales in September. This is a formidable 13.4% year-over-year increase.
Stretched housing inventory a concern
The tightness of inventory offers a caveat ahead though. Inventory has come down from 2.9 months to 2.5 months in September. To explain, it would require 2.5 months to sell all the currently active listings in the city. Experts agree that 6 month’s inventory (though I would say about 4 months is okay) is a prerequisite for maintaining supply-demand homeostasis.
While it is not unusual to see housing supply coming down nearing the end of summer, a successive yearly decrease points at a critical juncture Austin housing supply has reached. A compelling stat drives the point home: in August, single-family home sales shot up by 3.3% to 936 (year-over-year) – 3.3% is not that big a figure – and yet the inventory level came down to 1.8 months. City Council needs to come into the mix and sooner the better. Austin longs for more duplexes and multiplexes at this hour.
How the five counties are faring:
Single-family home sales in Travis County have increased by 4,3%, its median home prices rose by 3.4% to 380,000.
For Williamson County, the growth in sales has been 8.3% while the median home prices stand at $295,000 (unchanged year-over-year).
For Hays County, the growth in single-family homes sales has been 4.7%. Its median home prices have decreased by 6.9% to stand at $270,000.
The Bastrop County home sales over the same period registered an upswing of 15.7%. Its median home prices have mirrored Williamson County, remaining unchanged at $240,000.
Caldwell County offers the exception to the rule. It’s home sales have seen a theatrical drop of 18% (year over year) and yet, captivatingly, its median home prices have jumped up by 11% to stand at $216,000.
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