There’s news of a slowdown and talk of a recession, but the real data shows something completely different.
In the month of April, the Austin median home value was $550,000 up by 19% from $460,000 in April of 2021. Active listings went up by 52%, the biggest gain in inventory since 2017, and days on market increased to 18 days.
While inventory is increasing, so are pending sales. Let’s talk about what’s driving the slow in demand, and the increase in inventory.
Number one, mortgage rates are higher. Rates are up 2 full percentage points since December of 2021. This is a substantial increase in mortgage rates and makes homes less affordable. The second reason is the values have gone up and consumers that were at the lower end of the market are now priced out of the market.
Property tax rates have soared by 50% across Travis County and most other counties. Investors that have owned investment properties in Austin for several years and are behind on rent increases are likely to consider selling their properties. Anyone that bought more than 2 years ago is likely to consider their investment a high return. Investors are considering moving property more now than ever before.
The Austin real estate market has stabilized and will continue to see this throughout the year. As of the 23rd of May, there were over 3,800 new listings on the market. That’s up 85% from one year ago on the same date. At the same time, the number of pending home sales was 6,717. This is showing proof of steady demand.
What does this mean for buyers? It means that you have more choices of homes than ever before. It also means that competition will be down lower than it has been in a while, but you’ll still be competitive, albeit less than we’ve seen in a while.
For sellers, it’s still a great time to sell. You’ll have to be very thoughtful about your pricing. The biggest risk in this market is overpricing. If you price it too high and your home stays on the market, there is a bigger danger of getting less than you would have if it was priced the home at the current price.
As always, feel free to contact us. Speak to a real estate consultant about any of your buying and selling needs. We have over 100 agents across the Austin MSA and we’ll get you the right one to help you with your particular situation and area.
Posted by Ryan Rodenbeck on