Austin Market Update - August 2022

[David Ivy]

The August 2022 report from the Austin Board of Realtors shows the Austin metro market continuing to stabilize in response to high inflation, mortgage interest rates, record high home prices, and a possible recession in the US. Here are some important notes:

• The median home price in Austin was up 3% over August 2021 at $555,000. The median home in the greater metro sold for around $496,000 last month, which is up 5% year over year. Appreciation has slowed significantly in recent months, with home prices mostly flat in the Austin metro from Aug. 2021 to Aug. 2022. However, home prices have yet to show a year-over-year decrease and are, indeed, still rising.
• Austin’s housing inventory remained at 2.4 months, which was 1.5 months higher compared to this time last year. Metro inventory was at 2.9 months, which is also similar to last month. So, we’re still very much in a seller’s market with inventory that could be finding its equilibrium. Time will tell.
• Closed and pending sales were all down big. New listings were down slightly, while the number of active listings was up substantially compared to this time last year. In fact, there were 170% more homes on the market in the Austin metro for buyers to choose from last month compared to August 2021.

Cord Shifflet, ABoR president, summed up the current picture: “I want to be very clear—market shift does not mean that we are in a downturn, and it doesn’t mean that Central Texas home values have been overvalued. Home prices are still appreciating, just at a more reasonable rate, that’s more in-line with what we have seen historically. Homes are still selling close to list price, which is great news for buyers and healthy for our housing market.”

Here are the numbers for the City of Austin and the greater metro area:

If you’re a seller, you have to respect the available comparables, even those 3+ months old, and strongly consider other competing listings in the area when pricing your property. An asking price is no longer a jumping off point for a bidding war in the Austin metro. Buyers have much more selection and can now be more picky about a property’s condition. Sellers often have less negotiating leverage compared in previous years. Preparing a home well, staging when appropriate, and having strong marketing is crucial to help your listing stand out among the competition.

If you’re a buyer, you have many more properties to choose from and significantly fewer buyers competing for them. You have much more negotiating leverage. In many instances, you’ll find that you’re the only buyer making an offer on a property at a particular time. Unless something unexpected happens, the current market numbers and overall economic health of Austin suggests that prices are unlikely to fall significantly from their current levels. In fact, prices will probably rise again in the spring and summer, now that the market appears to be returning to its normal seasonal behavior.

[Chris Wolfe]

We are heavily focused in the Austin market and we've seen a 20%+ decrease in prices from May 2022.  It doesnt appear to be stopping as well.  We've got about 8 homes on the market, priced at or better than competition and they are still not moving.  Not sure how much is interest rate related, and how much is people reading headlines related, but inventory is not moving at all right now.  Eventually we will see some great opportunity for buying, but not sure how much more down we have to go.