Austin’s Housing Market: A Mixed Bag for Buyers and Sellers
AUSTIN, Texas — The housing market in Austin continues to be a topic of discussion as the number of homes available for sale increases. According to the latest data from the Austin Board of Realtors, there is a 15.4% rise in active home listings this year, bringing the total to over 12,000 homes on the market. This is an amount not seen in over 13 years.
Home Prices Still a Concern
Despite this increase in listings, home prices remain a challenge for many buyers. The median home price has dropped by 4.4% to $439,000, but this decrease has not been enough to lure buyers back into the market like during the COVID-19 pandemic, according to Housing Economist Clare Knapp. “Home prices are just a little bit too high still in the Austin market for buyers,” Knapp mentioned.
During the pandemic, Austin was identified as a highly desirable place to relocate. Homes were selling rapidly, with some getting purchased within just 20 days on the market. This sales surge was fueled by historically low mortgage rates, enticing many to make decisions quickly. “They were flying off the shelves … Stories about homes being sold sight unseen,” Knapp recalled. However, the situation has since shifted.
Sales Slowdown
Currently, the market is experiencing a 3% drop in home sales, with closing sales down 10%. Homes are now taking an average of 70 days to sell, a significant change from the craziness of the previous couple of years. “As demand soared, so did home prices,” Knapp said. But with the slowdown in sales, prices have not adjusted much, leaving many potential buyers still browsing without making purchases.
Another contributing factor is the outlook on interest rates. The Federal Reserve is expected to announce decreases in interest rates next month, continuing through . Knapp explained that while this could lower mortgage rates, it does not guarantee a drop in home prices. “If home prices don’t budge, we’ll likely just continue to see this decline in sales activity, or at least a stagnation in sales activity,” she warned.
What It Means for Buyers and Sellers
Despite the challenges ahead, there is a sense of opportunity for buyers in this current landscape. Knapp advises sellers to re-evaluate their asking prices while encouraging buyers to take advantage of the abundant supply on the market. “Buyers should understand just how much supply is on the market and to really use that to their advantage in terms of pricing their situation correctly,” she said. “Finding the right location for them. The right home for them.”
Looking Ahead
The Austin housing market remains a mixed bag with its increasing listings and stubbornly high prices. With home prices still too high for many, significant shifts in buyer behavior might not happen until either prices drop further or mortgage rates stabilize. For now, both buyers and sellers will need to navigate this evolving market with care and awareness.
