Home sales continue to climb in Austin, and it's beginning to spell bad news for not only new homebuyers but also current homeowners.
Homeowners want their property value to increase for resell purposes, but what happens when you can no longer afford the property taxes? People are looking outside the city limits, even neighboring counties.
The Austin Board of Realtors (ABoR) outlines this development in its April 2016 housing market report. In Austin, the median price for single-family homes is $359,450, an 11 percent year-over-year increase.
More affordable options can be found down the road in Hays County. "Hays County is one of Austin’s few surrounding areas with entry-level homes priced less than $200,000, a price point with high demand," explains Mark Sprague, Independence Title’s state director of information capital, in the report.
Because of this, Hays County experienced the largest gain out of all Central Texas counties analyzed in ABoR’s report. Last month, single-family home sales in Hays County increased by 18 percent year-over-year, and the median price increased 7 percent to $249,656. To compare, Travis County single-family home sales increased 8 percent year-over-year, and the median price grew 8 percent, to $339,500.
The imbalance of high demand and lack of supply in the Austin area is a major contributor to housing affordability. In April 2016, the Capital City had less than two months of housing inventory. To give context, six-and-a-half months of inventory is considered a balanced market.
“Housing affordability includes not only a home’s sale price, but the homeowner’s ability to continue to afford the home as property values rise from year to year,” says Aaron Farmer, ABoR president, in the report. “[ABoR] encourages homeowners to learn how their home is being appraised and all property tax exemptions they might qualify for.”
While this is sound advice for homeowners, the question still remains: Where will those looking for housing turn? It might be outside of Austin proper — and even Travis County — to places like Hays County, unless the city does something substantial to counteract the housing disparity.