Austin Real Estate Update | December 2021
The holiday season is here! I hope this finds you healthy and in good spirits. Please think of me should you or your friends/associates have any real estate needs or questions, I'm never too busy to help. This edition features the most recent market updates as well as Austin news and events - Enjoy!
According to the Austin Board of REALTORS® (ABoR) October 2021 Central Texas Housing Report, the Austin-Round Rock MSA housing market remains on track for a record-breaking year, even as the market continues its calming trend. Home sales across the MSA decreased 12.1% to 3,250 closings compared to October 2020 as the median sales price grew 24.7% year over year to $455,000 setting a record for the month of October.
Across the MSA in October, sales dollar volume increased 6.4% year over year to $1,836,686,318 and new listings increased 0.9% to 3,777. At the same time, active listings decreased 0.5% year over year to 3,475 and pending sales increased 4.4% to 3,774 across the MSA. Monthly housing inventory dipped 0.1 months of inventory to 1.0 months and homes spent an average of 20 days on the market, down 16 days when compared to October 2020.
Jon Hockenyos, president, TXP, Inc. — an economic analysis and public policy consulting firm — offered insight into why the market remains competitive and looks to signs of the supply chain rebounding which could help with new housing developments.
“While activity appears to have leveled off somewhat in recent months, Austin’s residential real estate market remains extraordinarily hot, as prices have risen drastically over the past year. Real estate in Austin remains a seller’s market as historically low interest rates, strong in-migration, a rapidly recovering local economy, and unprecedented stimulus all drive up the demand for housing. When the lowest inventory on record is factored into the mix, it’s clear that price pressures are unlikely to ease any time soon. Hopefully, the coming months will bring more supply to the market, as materials shortages ease and new development occurs.”
City of Austin In the city of Austin, the median home price rose 21.1% year over year to $536,000––a record for the month of October. Home sales decreased 11.7% to 1,062 sales, while sales dollar volume increased 2.2% to $704,910,050. During the same period, new listings decreased 8% to 1,236, active listings dropped 17.9% to 1,101, while pending sales increased 2.5% to 1,209. Monthly housing inventory decreased 0.3 months year over year to 1.0 months of inventory. Travis County At the county level, home sales also decreased 16.9% to 1,569 sales, and sales dollar volume dropped 3.9% to $1,035,465,570. The median price for a home increased 21.8% year over year to $522,625. During the same period, new listings decreased 3.3% to 1,942 while active listings declined by 5.8% to 1,811 listings. Pending sales increased 1.4% to 1,887 as monthly housing inventory decreased 0.2 months year over year to 1.0 months of inventory. Williamson County In Williamson County, October home sales decreased 4.4% to 1,170 sales, while sales dollar volume rose 27.5% to $553,594,267. The median price rose 33.4% to $430,000, and new listings increased 9.3% to 1,240 listings. During the same period, active listings rose 25.2% to 940 listings, and pending sales also increased 8.2% to 1,268 pending sales. Housing inventory increased 0.2 months to 0.8 months of inventory. Hays County In Hays County, October home sales decreased 11.2% to 372 sales, and sales dollar volume climbed 19.9% to $197,198,201. The median price for homes rose 30.6% to $399,750. During the same period, new listings increased 1.5% to 401 listings, active listings decreased 8.7% to 473 listings. At the same time, pending sales increased 10.8% to 450 pending sales. Housing inventory declined by 0.2 months to 1.1 months of inventory. Bastrop County In October, Bastrop County home sales decreased 20.5% to 105 sales, and sales dollar volume decreased 8% to $38,481,426. The median price increased 28% to $334,000. During the same period, new listings decreased 6.1% to 153 listings, while active listings also declined 8.1% to 204 listings. Pending sales decreased 9.3% to 136 pending sales and housing inventory decreased 0.4 months to 1.6 months of inventory. (information courtesy of ACTRIS)
National Market Update As expected, the FHFA announced conforming loan limits for 2022 of $647,200 for most of the country and $970,800 for “high cost” areas. This unsurprising move was needed to keep up with this year’s surge in home prices. Despite low inventories, Existing Home Sales grew 0.8% in October, following September's gain, which was the largest in a year. Sales are still down 5.8% from a year ago, underlining the lack of supply, as demand remains high. The Pending Home Sales index of signed contracts on existing homes made a surprising a 7.5% gain in October. According to the NAR, “existing-home sales in 2021 will exceed 6 million…the best performance in 15 years.” New Home Sales also rose in October. But before we get too excited, the 0.4% gain was due to a downward revision to September's number. But an upward trend is apparent, as the pace of sales is 9.1% above the June 2021 bottom. The good news is, there's a recent rise in the inventory of completed homes after nearly a year of declines. Plus, for existing homes, price gains have decelerated significantly, up a yearly 13.1%, down from 23.6% in May. Housing Starts slipped 0.7% in October to a 1.520 million annual rate, all due to single-family starts, down 10.6% the past year. But multi-families are up 36.6% in the same period, as builders respond to rising rents. Builders see more demand coming. Building Permits rose to a 1.650 million annual rate in October, up 4.0%, with 2.7% growth in single-families. The National Association of Home Builders sentiment index hit a six-month high of 83. We need about 1.5 million housing starts a year to handle population growth and replacements, a figure we haven’t seen since 2006. But it looks very likely we’ll exceed 1.5 million starts this year, and move higher in 2022. For most Fed watchers, a rate hike remains out of the picture for several months. After that, there is mounting concern on Wall Street the Fed will accelerate its tapering of bond purchases and may start hiking rates during the first half of next year to tame inflation. 29.2% of the Fed watchers project a rate hike at the March 16th meeting of the Fed.
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