Well, the July market stats are out (see link below) from the board of realtors and its a mixed bag all across the board. Overall, through the entire MLS, the median home price is up, year over year. This is because the under $300,000 price range continues to flourish. Its the most sought after price range in the city.
If you look at the sales numbers throughout Austin, central Austin shows a substantial decrease in sales over last July. Some areas, including Westlake, the Southwest Parkway corridor and 78704 show an actual decrease in property values. Before you look too deep into these numbers, know that much of this is due to a small sampling of data. Area 6 is the part of 78704 east of Lamar. This is an interesting area because there is SO much of a difference in price ranges between the northern part and southern part, that if more properties sold in the southern part, the data can be skewed. So much so, that I think this should be divided into two new MLS sections that I would label 6N and 6S, with the dividing boarder being Oltorf. The average sold price in this section decreased by .5% for properties that were in the same square footage range. I think if we narrowed this down, you would see that many more properties sold in the southern part of area 6 than the northern part and the norther part, which led to a data report that is hard to interpret.
Looking at area 7 (the part of 78704 west of Lamar) you see a substantial decrease in value. The median home price shows to be down 22.8% over July of 2013. Now in this section, not only is the data sampling small (only 11 homes sold in July of 2014) but the size range of the homes is dramatically different. In 2013 the average square footage was 1581. In 2014 its 1062, a staggering 32% reduction in the size of the homes sold. The average price per square foot is actually up 11% from $323 in 2013 to $359 a foot in 2014.
Still, its a mixed bag of information. As you will see in the below article link, July showed to be the first month of increase inventory in years. So people keep asking “whats going on here?” The amount of people moving to Austin does not seem to decrease and the headlines for companies moving to Austin and hiring hasn’t slowed down. My theory is that people moving to Austin have heard about the crazy market we’ve had here in the 24 months preceding June and they are being very cautious as to how they enter this market, if at all. Many would-be buyers are electing to rent instead of buy.
You see in the past 24 months, many sellers would look at a comparative market analysis and decide to price their property some 3 to 5, and in some cases even 10 percent above the highest comparable home that sold. And shockingly, it did sell. Buyers were willing to make up the difference between appraised price and contract price. Well with this recent slowdown, such tactics aren’t going to be successful. Can you sell your home in 2014? Of course, but you have to be reasonable.
If you are buying or were in the process of buying, this gives you a unique opportunity (compared to the previous 24 months) to enter into a market without the insane competition that we saw in 2013 or the early half of 2014. I believe that we have seen most (if not all) of the appreciation we are going to see in 2014 already.
I recently evaluated some properties in 78704. A property there sold for $449,000 in March in just 6 days. There are currently two actives on the same exact street and they are almost identical models. They have 51 and 73 days on the market, respectively. They are priced between $440,000 and $450,000 and sitting. But they were originally priced in the 470,000 range. I personally believe that had these sellers priced their homes in the range between $445,000 and $449,000, they would have sold within the first two weeks at, or close to, list price. But now they have a stale listing, and a savvy buyer will take advantage of this to get a price some $10,000 below what it should have been priced at.
I can tell you that I have lost out on a couple of listings recently to other agents that agreed to price listing at rates that were way too high. When I see them hit MLS, I breath a sigh of relief that I did not get that listing. Slow and steady wins the race, folks.
The take-away: if you’re a buyer, this is good time to get a decent deal compared to the 24 months preceding June. If you are seller, you can still sell, you just have to be reasonable with your list price. Don’t let greed lure you into selling your home lower than you should ultimately be getting. The DYI pricing program is over. Now more than ever do you need a qualified and service oriented agent. And, if you are reading this, well guess what? You’re on the right track
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We have some great articles below.
Texas inventory is up for the first time in years. – Check it out.
If you have lived in Austin for a while, you probably have heard people at some point saying that Austin is losing its identity with its growth. Well, thats song has been played for nearly 30 years now. Check out this article showing that people have been worrying about that since 1983. 30 years later and we still love it! Story here.
Alamo Drafthouse South Lamar and the Highball are finally reopening, and what a reopening it is! The Greatest Karaoke Bar In The World. The End.
And, finally, here are the Austin real estate stats for July, 2014.