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Market News and Trends

And another expert …


Last week I attended a great presentation by Mark Sprague, Director of Information Capital for Independence Title.  His view of the state of our real estate market is much like mine — that the market cycle is maturing but by no means turning down in Austin and Central Texas.  This chart is a good summary:

In case it’s hard to read, you’ll find Austin about halfway across the green band labeled “Exuberance.”  Traits described as typical in that phase are

  • Capital flowing freely
  • Surging prices and volumes
  • Affordability getting worse and/or construction getting high
  • Smart money taking some chips off the table

As I have noted, the current market cycle has run much longer than the typical  cycle, now with more than five years of housing supply significantly trailing demand, rapidly rising prices, and pronounced affordability and gentrification issues, especially the closer you get to Central Austin.  The rate of price appreciation has moderated somewhat, but year-over-year price increases will continue for this year (at least).

On the other hand, Mark doesn’t see a downturn on the horizon and was even willing to predict our “boom” conditions could continue for years.  The reasons are those that I have discussed — a strong local/regional economy, strong net job growth and consequent population growth.  Here are some relevant charts from his presentation:

Notice at least through 2017 the Austin-Round Rock metropolitan statistical area was behind the Permian Basin and its enormous growth in oil and gas production, but well ahead of all other Texas MSAs and more than three times the average growth rate of all charted U.S. MSAs.

Note also that our regional economy is diversified, unlike many other metropolitan areas:

And Mark’s summary on this topic:

That data ends with October 2018, but any cursory review of local business news will tell you that job growth has continued, and that our regional unemployment rate is even lower than a year ago.  There is every reason to believe that Austin will remain attractive and the regional economic development efforts will continue to bear fruit.

I’ll comment in a separate post with my own look at regional market data, but another respected market analyst and forecaster agrees that we’re not done with this market cycle yet.

About Bill Morris, Realtor

More than thirty years of business experience (high tech, client service, business organization and start-up, including many years in real estate) tell me that service is the key to success and I look forward to serving you. I represent both buyers and sellers throughout the Austin metropolitan area, which means first-hand market knowledge is brought to bear on serving your needs: -- Seller Representation is a comprehensive process that begins with thorough market analysis and consultation, continues with properly staging the home to achieve the highest price possible in a reasonable time on market, a complete program of marketing and promotion, ongoing updates and communication, closing coordination, and follow-up throughout (and after) the sale. -- Buyer Representation is also full service: shopping, previewing, price and market consultation, contracting, negotiating, coordination of inspections, appraisals, repairs, and closing details, and follow-up beyond the closing of your purchase to ensure your lasting satisfaction. Because the real estate industry is becoming more sophisticated and challenging every day, you need a professional that understands the industry and is positioned to stay ahead of the game. I go the extra mile to help you achieve your goals. That's why I constantly research the market and property values so your home is priced effectively from day one. I also make sure the public knows your home is for sale by using innovative advertising and marketing techniques to attract potential buyers.

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