Austin Real Estate Market Update - YTD, July 2013 & Decade in Review

How is the market doing this year? Gang busters! Probably the best way I know how to describe what we have seen so far, YTD, this year. Absolutely a run away market. One of the questions that buyers are rightfully asking right now is "Do you think this will continue?". I have to say, there is no compelling argument right now to tell me that this is not going to continue. New Austin area jobs continue to become available and people don't seem to be leaving Austin. Combine new jobs, new people coming into the area, current residents staying in the area with a shallow pool of available homes for sale and limited new home inventory--and you should probably expect prices to continue to go up and homes to continue to move fast. Well, that is my crystal ball forecast--anyway. I have no evidence to the contrary. 

So, let's start at a really high level review of the market.

Homes sold Year-to-Date (YTD)--just looking at single family homes, condos and townhouses, and compare this year's contracts to the previous 9 years:
  • July 30, 2013: 17,376
  • July 30, 2012: 14,503
  • July 30, 2011: 12,301
  • July 30, 2010: 12,447
  • July 30, 2009: 11,284
  • July 30, 2008: 13,934
  • July 30, 2007: 17,101
  • July 30, 2006: 17,124
  • July 30, 2005: 14,892 
  • July 30, 2004: 12,685
  • Looking at these numbers through July 30th (not 31st), it is clearly a banner year for Austin Real Estate!
Now let's roll back time and look at median market values over time for single family homes across the Greater Austin Area over the past 8 years. I am using eight years because eight years used to be the water-mark by which common experience said it should be okay to sell your home. Median home values have risen considerably in Greater Austin over the past 8 years:
  • YTD 2013: $225,900
  • YTD 2009: $193,000
  • YTD 2005: $164,000

Two additional indicators of what is happening in the market are the Days on Market Trend and the Inventory Levels. Days on Market is a simple indicator of how long a typical homes is sitting on the market for sale before it goes under contract. Inventory Level is a measure of available houses for sale vs the speed at which homes are being bought. These are both good directional indicators of market strength and comparisons over time.

Median Days on Market for Single Family Homes (DOM):

  • YTD 2013: 18 days
  • YTD 2012: 34 days
  • YTD 2011: 51 days
  • YTD 2010: 40 days
  • YTD 2009: 50 days  
  • YTD 2008: 42 days 
  • YTD 2007: 31 days 
  • YTD 2006: 34 days
  • YTD 2005: 45 days
  • YTD 2004: 45 days
  • Note: homes are selling at a far faster rate than we have seen during the past 10 years. Buyers are missing out on homes that they wanted to buy either because they failed to act with haste or in some cases because they were trumped by another buyer with a higher price.
 
Inventory Levels and Home Consumption Rate:
  • 9 weeks of inventory, or just over 2 months of total available inventory
  • [ 8,751 sold in past 90 days; avg: 2,930 per month; 6,674 active listings ]
  • Analysts would generally consider 7-8 months of inventory a balanced market, meaning the market does not favor either the seller or the buyer; the lower the inventory levels--the more favor given to the seller; the higher the inventory levels--the more favor is shown to the buyer.
  • With approximately 2 months of inventory, buyers are scrambling to find homes that meet their needs in the Austin market place; making the right trade-offs is a critical decision making feature of every home search, Realtor and Buyer. The entire team must be ready before opening the first door. 
Real Estate is local. Very local. Not all all communities have the same momentum; some areas of town are moving MUCH faster than the average and other parts of town are moving slower than the average. And the median still does not give you a good perspective on homes that are not priced to market value or homes that do not show very well. This is a high level view of the Greater Austin market. It tells us clearly which direction the wind blows, but it does not tell the whole story.

For details on your community and home, please contact me personally. 


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