Austin Real Estate Market Update, Dec. 2014--Year in Review
Yes, Austin has had a few unmerited detractors of late--writers that I would put in the category of nay-sayers, those too young to know better and the California press corp in general, who believe that all good markets become California at some point in time. But I am here to tell you: (1) Austin is not located in California (2) Technology companies are migrating this way more and more every day (3) As Austin continues to grow, increase in new jobs, expand in industry and entertainment, it will get closer to the center of many more national radars. And being near the center of the national radar makes Austin a bigger target to those who are looking for sensational headlines and those who simply don't understand what is happening locally, because they didn't bother to listen before they started talking. Once again, they have been proven wrong by another spectacular year of people migrating into the Greater Austin area.
Q: What happened in Greater Austin during 2014 and how did it compare to 2013?
- All Single Family and Condos Sold in 2014: 30,538*
- All Single Family and Condos Sold in 2013: 30,260*
Total revenue in 2013: $8,712,086,287
- Median sold price in 2014: $240,000
- Median sold price in 2013: $221,000
Median days on market 2013: 20
- Single Family Homes 2014: 27,390
- Single Family Homes 2013: 27,099
Condo/Townhouses 2013: 3,161
Q: What was the inventory condition of 2014 compared to 2013?
A: Inventory was tight both years, but there were a few months in 2014 where inventory increased by about one month. In general, most months had inventory levels between 3-4 months--making Austin a strong seller's market.
Q: What else "marked" 2014?
A: I believe sellers had to learn first hand that buyers will not pay "just any price" for their house. Many houses went through multiple price adjustments in 2014 until the home was in line with market value--that is to say, until buyers were willing to pay at or near the listed price. While this should have drug out the Days on Market (DOM) stat, because more and more houses were selling in under 1 week on the market, the over-all DOM stat continues to get smaller.
Q: What about foreclosures?
A: What foreclosures? Okay, Austin has had some foreclosures, but my professional opinion is that banks seems to be pricing foreclosures above a "reasonable value" to the competitive market. That is to say, if the foreclose had been listed at the same price and condition by the seller, it would not have sold for such a high price. If this is accurate (and I track this market and feel as though I am correct), banks are taking advantage of naive and willing buyers who will pay more than what they should pay for a property that needs a great deal of work to get the home to a competitive position to live or sell. Yes, there are always some exceptions to the rule and some remodeling for flipping and investment is still happening, but it is happen more among homes that the novice buyer will not touch--homes with major structural issues and extreme foundation repairs. In other cases, foreclosures may be sold in areas that the general public has not yet discovered.
Q: Is Austin still a market for investors?
A: As an investor and a Realtor for Investors, I certainly believe that it is. I believe Austin is a city in which people will continue to move, and a city that will continue to have a vibrant real estate market for years to come.
Q: Are the California doom and gloom forecasters right about Austin?
A: I think Austin will continue to be a target for hype and sensational headlines. My word to speculative writers: if you are forecasting future downfall of this market, you better have a better basis for your predictions than a feeling or reference to California. Texas is growing and is becoming a hot spot of technology, development and industry again. With that growth comes some bumps and certainly some good and some negative attention. But as long as jobs continue to grow and people want to come to live in cities like Austin, Dallas, and Houston--I think we will see a continued market growth or at very least--stability.
2015. It has a nice ring to it. Let me be bold again this year and say, I think we have a very good year ahead of us in the Greater Austin Real Estate market. More of the same for 2015--that is my prediction and forecast.
New construction homes: The number in this report do not include new home construction that was built from the ground up.
*Numbers my vary slightly from report to report, but all numbers should be directly correct and reflect numbers taken from the MLS database today, Jan. 17, 2015.