I made the point in 2012 in Review that the real estate market turnaround in the Austin metro area is unambiguously underway. This chart, courtesy of The Real Estate Center at Texas A&M University, tells you a lot of what you need to know about that:
Notice that every month in 2012 showed improvement in home sales (units) compared to the same month in 2011. January 2013 marked 20 — twenty! — consecutive months of year-over-year growth. And look at the magnitude: 35% more homes sold in January 2013 vs. January 2012!
At the same time, the supply of homes for sale has declined to the lowest point since early 2001:
With supply where it was 12 years ago, and strong and growing demand, our “months’ supply” is approaching a level we have seen only once before during the 23-year period covered here — just 2.6 months in January. At our inventory peak in this market cycle, we barely exceeded “balanced” market conditions. Now, we have been solidly in “seller’s market” territory for many months.
Predictably, that supply-and-demand environment is affecting sale prices. To filter out seasonal effects, this chart shows 12-month rolling averages of home sales and average sale prices:
As one more indicator of market strength, 35% of active listings sold in December 2012, approaching the level we last saw in the summer selling season at the market cycle peak in 2006:
We will likely see resale listing inventory build in the Spring and Summer. We will also continue to receive several hundred new residents into the metro area each week, so achieving enough inventory to satisfy demand seems unlikely. Meanwhile, home builders are ramping up quickly, but as I commented previously (Here’s Austin’s challenge in 2013: Housing Supply) the supply of new homes will be constrained by a shortage of buildable lots.
- If you own a home and have had thoughts of selling over the past few years, this could well be your time. All homes and all neighborhoods aren’t experiencing this boom in the same way, but give me a call so we can discuss your specific situation. Multiple offers and bidding wars are not unusual now in many areas, so one of the things we need to talk about is where you’re going and when. Properly prepared, priced, and promoted your home will likely sell quickly so you need to have a 30-45 day moving plan in place.
- If you have been thinking of becoming a homeowner in the Austin area, now is the time to act. There is no reason to expect conditions to improved from a buyer’s perspective, and prices are certain to continue rising. We have perhaps the healthiest local economy in the country, culture and environment that continues to attract employers and employees, interest rates remain at historic lows, and we’re still in the early stages of the next market cycle. Get preapproved to determine how much home you can afford, and let’s talk. If you need a mortgage professional I’ll be happy to help. Then, let’s get to work finding your new home.
I have skipped over much of the data and charts that I usually cover in my monthly update of the Austin Market Dashboard. The links below will display a complete, printable set of charts: