Real estate is a business of supply and demand. For the past four plus years in Austin, Texas, there has consistently been less than four months’ worth of housing inventory available. Data shows that low supply in the housing market also has driven up the median home price.
In a relatively short period of time, there’s been a dramatic shift in home sales by price range. In 2011, 67 percent of houses that were sold were priced below $250,000, while 32 percent were priced from $250,000 to just under $1 million. By 2017, those percentages flipped: 63 percent of sales were above $250,000, and 35 percent were below.
The trends of low supply and high demand look to continue as Austin’s population is projected to increase from 1 million in 2014 to an estimated 2.3 million by the end of 2020. In 2017, Austin saw 151 net new people move to Austin every single day!
In the past 10 years, the median home price in the Austin area has soared as well. In 2018, the Austin median home price was $319,000, up 66 percent from $192,000 in 2008, and median home prices in recent years have seen a year-over-year increase of 5.4%. In May of 2020, the median home price rose to $424,050 with an average of only 1.7 months of available inventory.
What does all of this mean for the continued growth of the housing market? There are some that think there will be an inevitable “normalization” of this strong market curve, while others that think the housing market will continue to boom if the city’s economy and job markets continue to prosper.
What, if anything, could cause a downturn in the market in coming years? Perhaps another U.S. Presidential election? Other potential factors could be trade/tariff issues, labor shortages, increased traffic and potential water-supply developments as the city continues to expand. And of course, we have yet to see the full impact of the global pandemic on the housing market.
However, for now, we are enjoying a real estate market that continues to boom with demand significantly higher demand than supply in Austin, Texas.
Are you wondering what the fair market price of your home is? Contact me for a complimentary home evaluation today!
Articles sourced:
2. https://www.statesman.com/business/20180627/expert-outlook-bright-for-austin-economy-housing-market
4. https://www.bizjournals.com/austin/news/2018/03/22/austins-population-keeps-popping-heres-how-many.html
