Austin Real Estate Market Trends:
Articles By Roselind Hejl

We have analyzed market data for the 2nd quarter of 2009, with a focus on the number of months of inventory for sale in each MLS section. 

Below is a comparison between the 1st and 2nd Quarters of 2009.  We looked for changes in inventory that indicate a trend in the market.  This data is for single family houses, without condos.

2nd Quarter 2009 Market Data

1st Quarter 2009 Market Data

   
Austin as a Whole:
For the Austin area as a whole, the inventory of houses on the market was 6.3 months at end of 2nd Quarter, 2009.  By comparison, the inventory was 5.9 months at end of the 1st quarter.  So, inventory has grown slightly, but we are still at a medium level.  Overall, Austin continues to have a balanced real estate market. 

Austin in Parts:

We reviewed 45 different geographic sections in the Austin area:

7 sections had less than 4 months of inventory:  Seller’s markets.  
18 sections had 4 – 6 months of inventory:  Balanced markets. 
20 sections had over 7 months of inventory:  Buyer’s markets. 

The buyer’s market sections were not so overloaded that they brought the whole Austin market into “buyer’s market” range.  The overall result for the city was in the balanced range – at 6.3 months of supply.

Price Range:

It is clear from the data that higher priced homes tend to be over supplied in most market areas.  Areas with many homes over $800,000 include Central and Northwest Austin, Westlake, Barton Creek, and Lake Travis.  These neighborhoods tend to be selected by builders who add to the supply.  We expect to see this inventory dropping, since new starts are down.  However, during the 2nd Quarter, the number of homes for sale over $800,000 slightly increased.  Months of supply for homes over $800,000 are:

                   1st Quarter             2nd Quarter
                   Months Supply       Months Supply
Area 1B       25.1                      28.7
Area 8E        21                         21.6
Area 8W      22.1                      23.7
Area W        24                         25.8
Area LN        34                         40.4
Area LS        28.8                      38.8

Foreclosures:

On average, foreclosures are 3.6% of listings on the market – not a significant part of our market.  (At the end of the 1st Quarter they were 3.7%, so not much change.)  However, some sections of Austin have more foreclosures than this.  These include the Manor, Elgin, Bastrop and some Southeast areas.  Here you may see foreclosures at 8% to 12% of listings.  These areas were popular with first time homebuyers, and were also targeted by investors during the boom market.  The good news is that these neighborhoods do not have high inventory levels.  This indicates that their foreclosures are being absorbed quickly and inventory is not building up. 

Conclusion:

In Austin we are not faced with serious depreciation, as a result of prices that were pushed to unsustainable levels. 

We are not faced with a serious foreclosure problem, generating its own downward spiral. 

And, we are not faced with widespread job loss.  We are a city that people are moving to.  Forbes ranked Austin #2 in Top Ten Cities for Relocating, citing “the metro area's thriving music, film and fine arts scenes, and it's also about the employers, which include University of Texas, Advanced Micro Devices and Dell.”

The current market still has higher than normal inventory in many popular neighborhoods - where builders were counting on faster absorption.  This is true of all price ranges, and is especially noticeable in the higher end. 

For buyers it is a great time to come into the market.  Interest rates are the best in a lifetime, and they certainly will not remain this low.  This is not the time to be waiting around for a better deal.  It is the time to start shopping for a great place to live in Austin!