Data from the Austin Board of REALTORS® (ABoR) shows that home sales are getting hotter in 2016. This February, the number of single-family homes sold rose to 1,783 compared to the same time last year, which represents a 2.9 percent increase year-over-year. Median sales prices for single-family homes also rose 8.0 percent to $269,900 in February 2016. Average days on market increased from 59 days in February 2015 to 62 in February 2016.
Increasing Competition Challenges Consumers
Despite the average days on market increasing three days this past February, many homes are going under contract within days of hitting the market. David Brodsky, of David Brodsky Properties, pointed out some of the challenges that consumers face in the current highly-competitive market. “We’ve seen our listings go under contract in as quickly as three days and – in some cases – with up to eleven offers. This type of buying frenzy makes it more challenging for home sellers to manage on their own and makes it difficult for buyers to get into the house of their dreams.”
Indeed, many buyers have experienced the disappointment of finding their dream home in their ideal price range only to lose out to a similar offer structured by an experienced Austin real estate agent. Brodsky pointed out that “As Austin real estate continues to strengthen, it’s becoming increasingly important for consumers to team with an agent who has strong negotiating skills and proven success working in this type of highly-competitive real estate market.”
Austin Officials Challenged to Keep Up with Rapid Growth
As homes continue to fly off the market almost as quickly as they enter it, city officials and real estate developers are both working to meet the needs of a red-hot Austin real estate market. Continued market growth has motivated city planners to prepare innovative and collaborative transportation initiatives to accommodate rapid population expansion throughout the Austin metro. Additionally, developers are working hard to make supply available as quickly as possible in an effort to meet overwhelming housing demand.
Aaron Farmer, 2016 President of the Austin Board of REALTORS®, explained, Austin-area residents are relocating farther and farther outside of Austin.” As the growing population expands throughout the Austin metro, city officials are looking ahead to create the requisite transportation infrastructure to accommodate commuters. “The Austin Board of REALTORS® is glad to see Mayor Adler’s regional approach to solving the Austin area’s growing transportation challenges through the Mobility 20/20 Solution.”
Supply Still Far Below Demand
Meanwhile, developers have successfully increased their construction pipelines to increase the number of new homes throughout the Austin metro. Eldon Rude, principal of 360 Analytics, an Austin consulting firm that tracks the housing market, told the Austin-American Statesman that his firm’s monthly homebuilder survey shows a strong start to the year for the new home market as well, with sales for the first two months of the year up 24 percent over the same months last year.
New home construction contributed to the 0.1 increase in housing supply this February over the same time last year. Supply reached 2.1 months of inventory in February 2016, up from 2.0 months in February 2015. Despite heightened new home production, however, supply remains desperately below housing demand. The Real Estate Center at Texas A&M University estimates 6.5 months of inventory as a balanced market. Considering the rate that housing supply has grown in the past year, it could be quite some time before supply catches up with demand to create a balanced Austin real estate market.
February 2016 Statistics
- 1,783 – Single-family homes sold, 2.9 percent more than February 2015.
- $269,900 – Median price for single-family homes, 8.0 percent more than February 2015.
- $333,011 – Average price for single-family homes, 7.6 percent more than February 2015.
- 62 – Average number of days single-family homes spent on the market, three days more than February 2015.
- 2,793 – New single-family home listings on the market, 11.1 percent more than February 2015.
- 4,871 – Active single-family home listings on the market, 10 percent more than February 2015.
- 2,346 – Pending sales for single-family homes, 12.3 percent more than February 2015.
- 2.1 – Months of inventory* of single-family homes, 0.1 months more than February 2015.
- $593,758,953– Total dollar volume of single-family properties sold, 10.7 percent more than February 2015.
Read more about the Austin real estate market.