Austin Market Report - March 2024

[David Ivy]

The March 2024 market report from the Austin Board of REALTORS® shows that the median home price in the City of Austin rose modestly by 2.7% to $564,995 over the past 12 months. However, the greater metro area’s median home price remained unchanged at $450,000 over that same period. Housing inventory in Austin and the greater metro rose to around 4 months in March. While still technically in slight seller’s market territory, inventory is well above extreme lows seen in recent years when inventory fell below 1 month for a sustained period.

Here are the full stats for Austin and the greater metro:

A 30-year fixed mortgage is sitting around 7.3% interest, which is the highest it has been in 2024 thus far:

In addition to interest rates increasing the cost of real estate ownership, buyers are facing increased insurance premiums, maintenance costs, and rising property taxes. See this recent WSJ article. As a result, home-buying affordability has fallen to its lowest level since 1985.

However, Austin’s red-hot economic engine continues to generate strong employment numbers, making the Austin metro the best job market in Texas and #7 in the US (tied with Nashville), according to WSJ’s recent study:

What if I’m a buyer? In many ways, this is the best market for buyers in Austin in years. There are more listings to choose from now than any other time in nearly a decade. Listings are selling for roughly 95% of their list price on average. Multiple offers are now the exception, not the norm. Buyers have significantly more negotiating power. They can take time with their search and be more selective about a property’s location and condition. So, if interest rates are a buyer’s primary roadblock, then I recommend seeking opportunities to negotiate a reduced interest rate from a seller or looking at new construction, where builders are offering rate reductions and other substantial incentives. Buyers should expect more competition in the spring, but conditions overall should remain favorable compared to recent years.

What if I’m a seller? Know that there is still robust demand for Austin housing and that prices are still considerably higher than just a few years ago. However, it’s important to price for today’s market conditions. Days on market are around 80 days on average, and many listings are reducing prices at least once while on the market. But properties priced appropriately can still go under contract in a matter of days, sometimes with multiple offers. Now is not the time to “test the market” with an ambitious price to “see what happens.” Since there are many more listings competing on the market than in previous years, it’s crucial to prepare a listing to stand out among the rest and work to address buyer objections prior to going on market. If you can wait to list in the spring or early summer, I recommend doing so to enhance your buyer exposure.