Bill Morris on Austin Real Estate
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One last post on pricing (for now)
In Austin Area Home Prices – 4Q 2019 I discussed home prices in different geographic parts of our metrolitan area. In More on Austin-area Home Prices I examined how sales volumes in different price ranges have changed over the past ten years. Now, to complete this look at changes in home prices over the years, I offer this summary — the overall distribution of home prices in the 5-county Austin metropolitan area (to be explained after):
These figures differ from those in the other two posts mentioned above because they include houses, condominiums, and townhouses. The earlier posts included only houses because not all of those housing types are present in all areas and price ranges. To discuss the entire metropolitan market this more complete view is appropriate. In addition, the earlier posts used MLS data, whereas the chart above uses data from the Real Estate Center at Texas A&M University, which only goes back to 2011 in this form.
To explain the chart, the top section shows the percentage of sales in each of the past nine years in each price range shown. Price ranges are highlighted that represented at least 10% of all sales in each year. For all of the past four years, the $400,000 to $499,999 range has been at that level. For the past two years, the $150,000 to $199,999 price range has been below 10% of sales. In 2018 and 2019, almost 75% of all sales were between $200,000 and $499,999. I believe that will be true again in 2020, but there will be upward migration within that distribution.
The bottom section shows the cumulative percentages (from low to high). The price range that includes the median sale price for each year is highlighted. A quick example of how to consider that information is: If you wanted to review 50% of all houses, condos, and townhouses sold, your search would include properties above $300,000 for the first time in 2018. It is worth noting that the sum of all sales below $200,000 fell below 10% for the first time in 2019.
The two rows between those larger tables show the median sale price for each year and the year-over-year change in the median price. That allows you to see the pace of broad price appreciation across the area and where each year’s median price was in the highlighted price ranges.
In More on Austin-area Home Prices I offered my belief that the $300,000 to $399,999 price range will still represent 20% to 25% of sales in 2020. We will see growth in higher price ranges as well. The key will be where home builders choose to spend their efforts.
