Active Home Listings in Austin Area Plummet 76%

Home sales are strong in the Austin area but limited supply is making it harder for buyers to find a home and driving up prices.

Across the five-county Austin area in March, active listings dropped 78.3% compared to a year ago, and homes spent on average only 26 days on the market, half as many as last year, according to monthly data from the Austin Board of Realtors (ABOR).

Dollar volume jumped 51.6%, outpacing the 13.6% increase in homes sold, which suggests a faster increase in prices in the luxury end of the market.

In March, the median sales price in the city of Austin jumped to $514,000 — an all-time high. That compares to $400,000 in Williamson County, $350,000 in Hays County, and $276,000 in Bastrop County.

Although outlying counties are cheaper, there are fewer options. Bastrop County had only 63 reported active listings in March, 81.1% fewer than the same month a year ago. Similarly, active listings dropped 85.6% in Williamson County and 78.1% in Hays County.

“Austin real estate is still a bargain by national standards,” said Dr. Jim Gaines, an economist at the Real Estate Research Center at Texas A&M University. “Compared to similarly competitive markets in cities like Denver and Atlanta, which are also experiencing rapid population and home price growth, Austin is coming from a stronger position in terms of affordability.”

“There is a reason so many transplants, especially from the east and west coasts, are coming to Austin; they can buy more house for their money than what they could in the cities they are leaving behind.”

In the meantime, homebuilders face shortages of land, labor, and rising materials costs. Apart from strong demand, those are also factors that are driving higher prices.

Furthermore, builders had to delay some construction during the February winter storm that shut down much of the state, constricting inventory even further.

March sales numbers likely reflect some deals that otherwise would have gone through in February. Adjusting for that, March’s year-on-year sales growth of 13.6% doesn’t look as strong as did in, say, January, when sales were up 23.9%.

Given limited inventory, it’s possible that April sales will be weaker.

Austin Board of Realtors President Susan Horton commented, “Our housing market is undergoing growing pains and creating a paradox-affordable from the outside looking in, but increasingly unaffordable for those who already call Austin home. While more homes are selling than ever before, it’s more and more difficult to find one.”

Originally published at https://www.honestaustin.com on April 15, 2021.