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This type of Austin real estate is being snapped up like crazy

Land sales in Central Texas are hot.

Photo courtesy of Kuper Sotheby's International Realty

Central Texas land is being snapped up like crazy, according to the most recent Texas Small Land Sales Report. The Texas Association of Realtors combed through 2016 data from the Real Estate Center at Texas A&M University to uncover where buyers are making their next big land purchase, and Austin-Waco-Hill Country leads the pack.

In 2016, the region had 2,409 small land purchases (200 acres or less) — a whopping 21 percent hike from 2015. In total, 55,078 acres were purchased in the area, representing almost 35 percent of all Texas small land sales. In Texas as a whole, there were 6,992 small land sales in 2016, a 4.2 percent increase from 2015.

"As our state's population continues to grow and the footprints of Texas cities expand, the demand for rural land will only increase," Vicki Fullerton, chairman of the Texas Association of Realtors, says in a release. "At the same time, after consecutive years of rapid growth in real estate land prices, prices in many regions have leveled off."

Unlike the regions where land costs decreased or plateaued, the Austin-Waco-Hill Country area increased. The average price per acre in the Hill Country jumped 3.9 percent to $8,684 in 2016, much higher than the $5,647 Texas average. It's still less expensive than the $10,182 price per acre you'll find in the Gulf Coast-Bottom Brazos region, which encompasses Houston, in addition miles of coastal property.

While farming and recreation are the most common uses for acreage in the Hill Country, such a dramatic increase year-over-year is driven by development needs.

So who's buying all that property? "Small land sales activity within Central Texas is driven by buyers from Austin, as well as the Waco-Temple-Killeen, San Antonio-New Braunfels, and Dallas-Fort Worth," the report reveals.

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Homebuyers can afford to be picky as Austin housing inventory rises

Photo by Avinash Kumar on Unsplash

Housing economist Clare Losey said the most significant factor affecting home sales in Austin is high mortgage rates.

The latest real estate report from Unlock MLS and the Austin Board of Realtors (ABoR) has revealed housing inventory is still on a steady rise in the Austin-Round Rock-San Marcos MSA, creating more choices for potential homebuyers as they navigate a high interest rate market.

Residential home sales dipped by a mere 1.5 percent year-over-year from October 2023, amounting to 2,248 closed sales in the Austin-Round Rock-San Marcos MSA. Median prices have also dropped to $430,000, or 3.2 percent less than this time last year. More than 3,300 new home listings were added on the market — a 7.4 percent increase from 2023 — bringing the total number of active home listings to 11,599.

According to Unlock MLS and ABoR housing economist Clare Losey, Ph.D., October's mortgage rates stood at 6.4 percent and are showing no signs of a significant drop in the near future. Even heading into 2025, Losey says potential homebuyers who are biding their time in the hopes of seeing rates plummet "may be in for a long wait."

"In the meantime, sellers must recognize that bringing buyers to the table requires a more aggressive pricing approach," Losey said. "Even in a more balanced market, buyers with limited purchasing power are struggling to meet current price expectations."

As for the overall health of the Central Texas housing market, 2024 Unlock MLS and ABoR president Kent Redding labeled recent news reports that called Austin "ground zero" for a downturn as an "extreme over-exaggeration."

"Austin led the state and nation in record-breaking home price growth and sales activity during the pandemic," Redding said. "For three years, near-zero housing inventory, numerous offers above list price and a rapid-paced market raised home prices and left little negotiating power for buyers. During this record-setting growth, ABoR and Unlock MLS consistently emphasized the unsustainability of the rapid growth, and now, our market is working to balance those extremes."

Central Texas housing trends in October 2024

In Travis County, 979 homes were sold last month — a slight 2.5 percent increase from last year. Median prices remained flat year-over-year at $510,000. Active home listings continued growing to 5,702 homes, which is 9.4 percent more year-over-year.

In Williamson County, 807 homes were sold in October, with median prices steadily dropping to $420,000. There were 1,028 new home listings on the market, showing a 4.5 percent increase from October 2023, bringing the total number of active home listings to 3,369.

Residential home sales dropped by nearly eight percent in Hays County in October, totaling 315 sales. Median prices also fell 5.5 percent year-over-year to $359,000. Active listings rose 6.6 percent year-over-year to 1,740 homes with the addition of 534 new listings on the market.

Meanwhile, 114 homes were sold in Bastrop County last month, which is 4.4 percent more than this time last year. Median prices dropped by a single percentage point year-over-year to $355,000. There were 654 active listings on the market in October, and 152 new home listings, representing a 1.3 percent slip in new inventory when compared to last year.

Only 33 homes were sold in Caldwell County in October to reflect a near 14 percent decline year-over-year from October 2023. Median prices fell to $262,990, which was a 13.5 percent decrease from last year. There were 136 active homes on the market last month, and 40 new homes added on the market.

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