Austin Chamber

November 8, 2016 – Housing Market

Posted By Chris Ramser | Nov 08, 2016
Central Texas Economy in Perspective Print Article Austin Chamber
  • The number of homes sold in the Austin metropolitan area for the first nine months of 2016 was 25,428, or 3.8% greater than same period in 2015.
  • In September, inventories at 2.8 months. Austin has had less than three months inventory on the market since November 2012.
  • Austin's year-to-date dollar volume sales is 9.3% higher than last year, and the average home price – $345,435  -- is up 5.3% compared to the first 9 months of 2015.
  • Median home price in September 2016 was $269,995, up $17,000 or 6.7% from one year ago.  Monthly median above $250,000 since March 2015.

Activity & Inventory

Austin’s existing home sales in September totaled 2,857, 1.5% above the number of homes sold in September 2015, and -12.3% below the total for the prior month, according to the latest numbers from the Austin Board of Realtors and the Real Estate Center at Texas A&M. That August to September drop is consistent with the seasonal pattern in the Austin market. On a year-to-date basis, the number of homes sold in the Austin metropolitan area in the first nine months of 2016 (25,428) is 3.8% greater than the number sold in 2015.

National Association of Realtors data for the U.S. show September home sales up 2.8% over the volume one year ago, while year-to-date sales are up 3.2%. Statewide, September sales are up 2.7% compared to a year ago, and 2016 year-to-date sales are up 3.6% over the first 9 months of 2015.

The dollar volume of Austin metro 2016 home sales through September is 9.3% ahead of the same period last year, while the gain is slightly less statewide and nationally, 7.0% and 6.7%, respectively. For the month of September, the value of Austin sales are up 8.3% over last September, while Texas is up 8.7% and the nation is up 7.1%.

Austin’s months of inventory on the market measure has averaged 2.4 months in 2016 to date, up from 2.3 in 2015. In September, inventories are at 2.8 months, unchanged from August, but up from 2.6 one year ago. Statewide, supply has averaged 3.7 months in 2016 compared to 3.6 over the first 9 months of 2015. At 3.9 months in September 2016, statewide supply is unchanged from August and up slightly from 3.8 one year ago. Nationally, the months of inventory fell from an average of 4.9 in 2015 to 4.5 in 2016 on a year-to-date basis, and in September 2016, supply is at 4.5 months, compared to 4.6 last month and 4.8 a year ago.

Austin has had 47 consecutive months of less than three months inventory on the market, dating back to October 2012. The only other years in which inventories dipped as low were 1999 and 2000. A balanced supply is commonly considered to be six months.

The months of inventory calculation is derived from the number of homes sold and the number of active listings. There has been a monthly average of 6,525 listings on the market in 2016, up 8.3% from the first 9 months of 2015. The last three years have seen fewer average monthly listings than any year from 2001 through 2012, even though sales have steadily climbed each year. September 2016’s active listings, 7,579, are slightly higher than the previous month by 0.5% month and 12.35% above last September. Even though the number of listings have inched higher, they are still well below the approximate 9,500 averaged during the period of 2008-2011.

A slight increase of the number of months on inventory and the number of active listings is not unexpected given the pace of housing starts during 2016.  In an article earlier in November, the Austin American-Statesman reported that housing starts hit a 6-year quarterly high with 2016 Q3 construction hitting 4,067 home starts, approaching the peak experienced in 2006 Q1.  To date this year, 13,402 home starts were recorded through September, a 16% increase from the level of 11,555 during the same time last year, according to data from Metrostudy.[1]

Prices

Austin’s median home price in September is $269,995, down from August by -5.3%, but up from one year ago by $17,000 or 6.7%. Austin’s median has exceeded $250,000 since March 2015. Statewide, September’s median sales price is $210,000, up $15,000 or 7.7% from a year ago. The national median price is $234,200, up $12,500 or 5.6% from September 2015.

Austin’s year-to-date median sales price is $279,900, up 7.6% over the same period of 2015, while the state is at $210,000 and up 7.1%.  

In 2014, Austin’s median price of homes sold exceeded the state median by over 30% for the first time. The differential between Austin and the state approached this level just before the dot-com recession. After falling each year through 2005 (reaching 18%), the difference climbed sharply through 2008 and for 2008-2014 has averaged about 29%. Last year, Austin’s median price was over 33% higher than the state, and based on the year-to-date numbers, Austin’s 2016 median price will likely again exceed Texas’ by over 33%.

The median sales price in the Dallas MSA for September is $232,425, up 11.7% from last September and San Antonio was at $203,000, or 6.6% higher than one year ago.  Both Dallas and San Antonio’s YTD median sales price are up from the prior year at 8.5% and 5.7%, respectively.  Data for Houston was not yet available. 

The average price in Austin in September, at $338,762 is down 4.2% from August and up 6.7% from a year ago. On a year-to-date basis, Austin’s 2016 average sales price is $345,435, up $17,347 or 5.3% from 2015. For Texas, the average price thus far in 2016 is $259,553, up 3.3% from 2015. The YTD national average price for 2016 is $276,111, 3.5% over 2015.

Within the Austin MSA, the Real Estate Center at Texas A&M publishes market data for ten local market areas in the region based on the boundaries of the local associations and board of realtors.  Median prices for September 2016 ranged from $320,000 in Austin to $187,795 in San Marcos. Median prices for the first 9 months of the year appeared positive over the same time last year in all 10 local market areas. We’ve split the 10 local markets into two graphs showing the monthly median price from January 2011 for the northern and southern portions of the region.

The Chamber’s Economic Indicators page includes an Excel spreadsheet (updated monthly) of Austin, Texas and national time series data for home sales and prices from the Real Estate Center at Texas A&M and the National Association of Realtors, as well as Housing Opportunity Index data from the National Association of Home Builders.

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Footnotes:

[1] According to the Statesman article, “the market has been hamstrung by a shortage of new and resale homes relative to demand. The good news is that supply is growing to meet demand, Metrostudy said.”

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Chris Ramser

Director of Research, Chris Ramser, joined the Chamber’s Economic Development Department in 2011, after 6 years doing community & economic development, and GIS mapping with regional planning agencies. Chris earned a B.A. in Political Science & History at Southwestern University.