November Blog

Austin Area Home Sales Increase by Over 19% in October

According to the Austin Board of Realtors® sales of existing homes in the broader Central Texas area increased by over 19% in October when compared to October 2010. The ‘median price’ declined 3% to $189,720. (The ‘median price’ is that price at which 50% of the homes that sold were sold above that price and 50% of the homes that sold were sold below that price.)

Judith Bundschuh, Chairwoman of the Austin Board of Realtors® said, "With October marking the fifth straight month in which home sales volume has outpaced the prior year, it's clear that demand for real estate continues to drive the economic recovery in Austin".

Over 1,450 homes were sold in the greater Austin area in October, compared with just over 1,200 in October, 2010 - a 21% increase in sales.

There was also a very substantial 18% decrease in the number of available homes on the market to just over 7,900 listings. “Pending sales”, or those houses that were under contract but not yet closed, were also up a solid 15% from October 2010, with just over 1,600 sales in the closing stage.

This decrease in available inventory continues a month’s long trend, and represents the lowest level of available inventory since 2008. This represents a tremendous overall improvement as well as positive direction for the local real estate market.

One of the key measures of any real estate market’s overall health and vitality is what is known as “months of inventory supply”. This number represents, at current “absorption rates”, how many months of housing supply there are currently available in inventory. By the end of October, 2011, there were about five months supply of homes on the market. This represents an impressive 23% reduction in the “months” of inventory available, and is the lowest figure since the Austin Board of Realtors® began tracking the number in January, 2009.

Austin's housing market has fared much better than many other parts of the US, fueled by job growth, continued population growth, and a highly diversified economy when compared to previous downturns both here locally and nationally.

For the full year-to-date (January 1^st, 2011, through the end of October), overall residential sales were up an impressive 7% when compared with the same period in 2010. For the year, the area's median home price was unchanged at $194,900.

So what does all this mean for both buyers and sellers? Clearly, for buyers, Economics 101 says that continued decreases in supply, coupled with sustained increases in demand, will inevitably lead to price increases at some point. Although Austin home prices have remained for the most part steady this year there’s no guarantee that will continue. Especially as we move into the spring buying season. For sellers, anything below six months supple of available inventory has traditionally been a ‘seller’s’ market.

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Austin Area Home Sales Increase by Over 19% in October