New data from the Austin Board of REALTORS® shows that while there is economic uncertainty resulting from the covid-19 pandemic, Austin home sales have maintained strong growth and currently show no significant signs of stopping in the near future. Recent home sales numbers show that despite the chaos on Wall Street, house hunters are still in need of a home in which to live. Especially in the Austin area, where housing demand is still at an all-time high and inventory has not been able to meet demand.
Mark Sprague, state director of information capital for Independence Title, explained his view on the Austin economy and real estate market. In a report released with the housing statistics, Sprague showed confidence in the local economy.
“Austin’s economy has diversified and strengthened over the past two decades. This leads me to be optimistic that our region is in a strong position to withstand economic downturns that may have a greater impact nationally,” Sprague said. “Effects will still be felt, especially by those who depend on each paycheck to pay their bills and provide for their families, and that cannot be discounted.”
The Austin Economy
One very important factor to remember about home sales is that it is fueled by job and population growth. Despite the tragic slowdown in many segments of our economy – such as the hospitality and restaurant industries – there are businesses that can still function under the recent guidelines set forth by the CDC. Specifically, the Austin job market is in the unique position of being heavily represented by the tech industry, which often has the advantage of workers being able to work from home. Those businesses will be able to continue operations without too much penalty. In fact, the Austin area was recently named one of the most recession-proof cities in the U.S. mainly due to the strength of its real estate market, job market and wage growth.
Additionally, the tech giants who have already made a commitment to relocate to the Austin area will still need to make a move to the region whether now or in the future. For instance, Google has signed a lease on an entire building coming to the downtown Austin area which will represent about 5,000 jobs. Apple is still working on its famous North Austin campus, which is expected to reach a max capacity of 15,000 employees by 2020. So the projected future job growth for the area is a good sign that the local economy will efficiently recover from the effects of an economic downturn.
Austin Real Estate Performance
The general consensus seems to be that the Austin real estate market will be well-insulated from an economic downturn. People will still need somewhere to live. Where better than in a city with one of the best job markets in the nation?
“Current indicators are that Austin’s housing market remains strong and competitive. Any decrease in inventory would only increase competitiveness in our market. Overall, Austin’s economy and housing market look to be resilient during this uncertain time. Once COVID-19 subsides, there is a potential for even more investment by employers in the Austin market, and I would expect those looking for a more affordable cost of living compared to other major U.S. metropolitan areas will still look to move to and buy homes in Austin,” he concluded.
An accomplished local broker and former Wall Street CFO echoes Sprague’s confidence.
“Our real estate market has been strong for about a decade now. A temporary decline in activity in the Austin real estate market is not likely to significantly lower home prices. Given how appealing our market is, Austin real estate is likely to rebound quickly even in the event of a more protracted decline,” explained David Brodsky, founder and principal at the boutique real estate brokerage by the same name.
Current Real Estate Opportunities
As steps are being taken to shore up the national economy during this time of crisis, there are opportunities for both buyers and sellers that need to be considered. Austin area home prices are still near record highs. As of the time of this post, mortgage rates are at historically low levels. Sellers who are thinking of cashing in on their equity may find that this is the right time to list their home. Buyers can take advantage of low interest rates and increase their buying power in the Austin market.
“Historically low interest rates are a driver in the market response we saw in February and will continue to act as a driver despite our shared concerns over the impact of COVID-19 in our community,” said Romeo Manzanilla, 2020 ABoR president.
The key to determining whether or not this will be an ideal time to start a real estate transaction is to consult with your trusted Austin real estate strategist.
“Everyone has different circumstances,” said Brodsky. “There’s really no ‘one-size-fits-all’ solution for everyone when it comes to real estate. Your personal circumstances are the basis of developing a strategy that’s best for you.”
Austin REALTORS® Providing Safe Real Estate Services
In our current social climate, real estate professionals are looking at best practices for providing safe real estate experiences for their clients. With social distancing and regulations on numbers of people who can gather in a public area, virtual tools have become increasingly important. Manzanilla explained what REALTORS® are doing to ensure a safe and comfortable real estate experience for consumers.
“REALTORS® will work to provide a new homebuying and selling experience in these times. Expanded visual libraries, interactive floor plans and virtual tours are tools that matter more than ever in this climate. The housing market is absolutely still open for business, but the business of real estate is evolving like we all are through this experience,” Manzanilla concluded.
Austin Area Real Estate Statistics
- In the Austin-Round Rock MSA, the median sales price for February 2020 increased by 12.8% to $327,140 since last February
- Sales dollar volume increased 21% to $1,027,245,686
- New listings decreased 11.8% to 2,925 listings
- Active listings decreased 29.4% to 4,534 listings
- Pending sales jumped 10.9% to 3,137 pending sales
- Monthly housing inventory declined 0.7 months year over year to 1.5 months
- There were 2,524 closed sales across the 5-county MSA
City of Austin
- The median price for residential homes in Austin was pushed up 14% to reach $395,000 this February over last
- Residential home sales increased by 3.3% to 857 sales
- Total sales dollar volume increased by 18.1% year over year to $417,071,623 last month
- New listings decreased 5.6% to 1,032 listings
- Active listings dropped 34% to 1,072 listings
- Pending sales rose 4.5% to 999 pending sales
- Monthly housing inventory decreased 0.6 months year over year to 1.0 month of inventory
- At the county level, residential home sales increased 8.8% to 1,301 sales
- Sales dollar volume increased by 22% to $613,634,673
- The median price for residential homes increased 13.2% year over year to $376,500
- This February, new listings decreased 13.6% to 1,550 listings
- Active listings decreased 35% to 2,022 listings
- Pending sales increased 9.4% to 1,615 pending sales
- Monthly housing inventory decreased 0.7 months year over year to 1.3 months
- In Williamson County, February residential home sales increased 4.7% to 851 sales
- Sales dollar volume experienced a double-digit increase of 13.3% to $277,257,487
- The median price for residential homes increased by 6.8% to $293,600
- New listings declined 16.9% to 863 listings
- Active listings decreased 33.7% to 1,398 listings
- Pending sales increased by 7.1% to 991 pending sales
- Housing inventory declined 0.9 months year over year to 1.4 months
- Hays County residential home sales increased by 3.9% to 270 sales this February
- Sales dollar volume jumped 37.6% to $110,763,712
- The median price for residential homes increased by 9.6% to $285,000
- New listings decreased 4.4% to 351 listings
- Active listings dropped 17.6% to 700 listings
- Pending sales spiked 23.7% to 397 pending sales
- Housing inventory decreased 0.7 months to 2.1 months
- In Bastrop County, residential home sales remained flat at 77 home sales
- Sales dollar volume increased 13.7% to $20,306,295
- The median price for residential homes slightly increased by 3.7% to $239,950
- New listings spiked 27.8% to 124 listings
- Active listings rose 16.1% to 324 listings
- Pending sales jumped 20.7% to 105 pending sales
- Housing inventory decreased 0.1 months to 3.3 months
- February residential home sales throughout Caldwell County spiked 47.1% to 25 sales,
- Sales dollar volume jumped 40.4% to $5,379,315
- The median home price decreased 9.6% year over year to $201,000
- New listings spiked 85% to 37 listings
- Active listings increased 18.4% to 90 listings
- Pending sales rose by 38.1% to 29 pending sales
- Housing inventory rose 0.3 months to 3.5 months of inventory
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