Real Estate Rumblings

Austin home sales starting to decline as median price soars to $420,000

This home is currently listed on Zillow for $419,900, just shy of Austin's current median price.

Photo courtesy of Austin Board of Realtors/Zillow

As the saying goes, once is chance, twice is coincidence, three times a pattern, and six months a trend ... at least when it comes to Austin real estate.

On July 17, Austin Board of Realtors released its June and midyear 2019 reports, the latter a compilation of the first six months in Austin and Central Texas real estate, and the numbers indicate the city's housing bubble may be starting to deflate.

Last month, the median price for a single-family home in Austin soared 10.9 percent to $420,000. (It's worth noting that it was only last month that Austin home prices first broke the $400K ceiling with a median price of $407,400.) During that same time, single-family home sales inside the city limits decreased 2.3 percent over last year.

Austin's single-family sales decline/price increase has been happening throughout the first half of 2019, something ABOR says may be indicative of a greater trend. Between January and June, home sales dipped 1.6 percent year over year to 4,736 sales. During that same period, the median price increased 3.2 percent to $387,100.

"We have seen slight dips in Austin's home sales before, but because this decrease is over the course of six months, it could be indicative of a larger trend," says Kevin P. Scanlan, 2019 ABOR president, in a release. "Austin's limited housing inventory — which dropped below two months in June — and increasing home prices have resulted in fewer sales over time."

So, with inventory inside the city limits tightening, where are potential homebuyers looking? The suburbs, of course. "As Austin continues to be one of the most desired cities to live in the United States, the suburbs are benefiting from this demand," Scanlan continues.

While the city cools down, sales in the greater Austin-Round Rock metro area are heating up. In June, the region saw a 4.3 percent year-over-year increase in sales, amounting to 16,203 homes sold. Travis County, meanwhile, held relatively steady, with single-family home sales increasing just 1.1 percent over 2018.

Though Williamson County took a slight dip in June, falling about 0.4 percent over last year, the county has seen an overall growth of 7.8 percent in the first six months of 2019.

Hays and Bastrop counties have also seen near double-digit growth this year. Single-family homes in Hays have increased 6.3 percent in 2019, while Bastrop has seen 9.4 percent growth in sales over the past six months.

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local real estate report

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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