2017 Austin Area Real Estate Market Update
I hear clients asking the questions: Is our market cooling off? Will this market continue? How much gas is left in the tank? Well, they are all good questions and I think you should look at the numbers, before you listen to the analysts who prognosticate in the company break room. This is often not the best place on the planet to get your business news and market analysis.
If you like reading charts, you can see from this chart that 2017 looks amazingly like the record sales of 2016. The numbers from month to month vary slightly, but the general momentum and number of Single Family Homes sold during the first four months of 2017 are un-surprisingly similar to 2016.
Sales prices are incrementally going up this year from around $275,000 to just around $310,000 (green bar on chart that is going up month to month). And the DOM (Days on Market) indicator is telling us that we have entered into the "high season" of home buying in Greater Austin (blue bar which is decreasing month to month). While January may have felt like we were slowing down, because houses were not moving at such a fast pace, homes are now selling on average in less than two weeks. Keep in mind, these numbers are the median. So we are looking at the middle of the market and taking our pulse from the middle. There are still homes that are listing and selling in 1-2 days and there are still homes that are either priced too high or don't show well, and are sitting on the market for a much longer period--weeks or months.
In 2016 you can see from the chart on the right that sold home prices started lower than the 2017 numbers above and also went up and to the right during the first 120 days of the calendar year. Starting in the $250's in January 2016, by April 2016 the median home value was approaching the low $280's. So, the spread from 2016 to 2017 would put us in the ball park of $30,000 year over year, or in the 12% ball park of growth in median home value.
Interest Rates. Indications are still strong that the Federal Reserve will most likely make a move to push the market interest rates up during their June 13-14 meeting. This could still change, depending upon a host of national and international factors that influence our economy, consumer confidence, inflation and un-employment, but the current thinking seems to be that interest rates will most likely continue to go up this year, and June is still a likely target of the next increase in rates.
So, there is my crystal ball. Full Disclosure: I am not a financial analyst and I can not see into the future. I am just a humble Realtor who tries hard to keep up with what is happening in our local market and provide good information to my clients about what I see happening in our local real estate market, not Texas. Not the United States. Not the world market. :)