Austin home prices drop while low inventory spells less affordability for buyers
REAL ESTATE REPORT
Average home prices decreased last month while inventory remained flat, signaling that the Austin regional market needs more housing. The latest monthly report from the Austin Board of Realtors (ABoR) shows median home prices dropping 6.3 percent in January, marking the largest price decrease since July 2011.
According to the report, the current average home price in the Austin metro area is $450,000. But even with the price drop, homes spent an average of 76 days on the market, only three more days than in December 2022, but 47 days more than in January of last year.
Residential home sales last month declined 27.3 percent in comparison to January 2022, with new listings also seeing a 16 percent decrease year-over-year. However, new listings from December to January increased 63.4 percent to 2,988 homes. ABoR’s report says this trend shows sellers are finding more opportunities in the market, while also demonstrating more active buyers.
Ashley Jackson, 2023 ABoR president, warns that these recent year-to-year comparisons are occurring at an abnormal time in the market. She says January’s data demonstrates a “post-pandemic normal” for the Austin-Round Rock metro area.
“As we reset our expectations to reflect the information our realtor experts are seeing in real-time, we need to look at month-to-month trends to have a true sense of what is going on in the region,” she said in a statement.
Despite the median home price decreases in Austin and Travis County, surrounding areas like Caldwell and Hays counties are seeing the opposite. Jackson says the two outlying counties are “the most affordable pockets in Central Texas.”
“When we have a city like Austin challenged by affordability, the entry point in surrounding areas will slightly increase as people try and find neighborhoods they can afford,” she said.
She predicts rising interest rates and availability of affordable housing will be a much bigger challenge for consumers in 2023.