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Austin is among the 20 most 'house rich' cities in U.S., report says

14917 Babbling Brook Dr, Austin home for sale

This charming Austin home is on the market for $370,000, less than the median value of a home in the city.

Photo courtesy of Realtor.com

With high interest rates and home prices making daily headlines, houses in Texas' current real estate market may seem out of reach for many potential homebuyers. But that isn't the case in Austin. A new study has revealed that Austin is the No. 16 most "house rich" major city in the nation.

To define the term "house rich," home services provider All Star Home examined data from the U.S. Census Bureau regarding the median value of owner-occupied homes and the median household income across the 25 most populous American cities. A home-value-to-income ratio was established for each city based on the Census data, and rankings were determined based on whether a city had a low home-value-to-income ratio and high homeownership rate.

The study found that 44.70 percent of all housing in Austin is owner-occupied. The median home value of a home in the city is $593,000, according to the Census data, which also pegs the median household income at an estimated $89,415 per year.

Using those financial factors, All Star Home determined Austin has a home-value-to-income ratio of 4.83.

Austin's median home value is significantly higher than the median prices of homes for sale in the city. Median home prices dropped to $435,000 in October, according to the latest real estate report from the Austin Board of Realtors.

Elsewhere in Central Texas, San Antonio far outpaced Austin in the report, ranking 10 spots higher as the fifth most "house rich" city in the nation. San Antonio has a homeownership rate of 52.30 percent, and the median value of a home in the city is $335,200.

El Paso took the No. 1 spot in the report, leading over all other major American cities with the highest homeownership rate (59.80 percent) and a home-value-to-income ratio of 2.68. Houston (No. 12) and Dallas (No. 15) also earned spots in the report.

The top 10 most house rich major cities in the U.S. are:

No. 1 – El Paso, Texas
No. 2 – Oklahoma City, Oklahoma
No. 3 – Indianapolis, Indiana
No. 4 – Fort Worth, Texas
No. 5 – San Antonio, Texas
No. 6 – Jacksonville, Florida
No. 7 – Columbus, Ohio
No. 8 – Philadelphia, Pennsylvania
No. 9 – Charlotte, North Carolina
No. 10 – Phoenix, Arizona

All Star Home also analyzed the most house rich states in America, but Texas appeared at the bottom of the study's category for the least house rich states, ranking No. 21. (Which really only makes it a middling score.)

The full report can be found on allstarhome.com.

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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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