Here are the May Single-family Home Sales Statistics for Austin, TX:
May represents the last of the “Covid-19 aberration” months for real estate since Covid lockdowns began in March and Texas began opening back up again in May, 2020. So, Apr & May numbers aren’t quite as reliable as the 1st quarter/2021. Mar/2020 sales numbers were barely affected since closings at that time went under contract 30-45 prior and the lockdown was around March 20th, toward the end of the month. Regardless, the numbers above are quite impressive, especially the median and average prices going up by $146,000 and $197,223, respectively...in only 12 months!!
I mentioned before that if you were to only watch 1 statistic up there to see the overall health of our Austin real estate market it would be to watch the Months of Inventory. That number represents the number of months it would take to sell all homes currently for sale (“Listings) at our current sales rate. In May, we only had .40 months and have ranged between .30 and .50 the 1st 5 months of 2021 (we’ve been below 1.0 months since July/2020). Compare that to the months of inventory we experienced the last decade (graph at right) 
when our 11-year bull run (ie-”Sellers Market”) began in Mar/2011 as we dropped below 6.0 months (a market in equilibrium). One of the reasons the past decade was a very strong seller’s market is that we remained so far below 6.0 months which represents a balanced market (ie-no advantage to either buyer or seller).
Until we get into at least the 1.5-2.5 months of inventory again, buyers will continue to face rapidly rising home prices and a very tough market for them to buy again. There are many factors/forces that affect inventory as I shared via a new chart a few weeks ago and several of those need to consistently go against home sellers before our market begins to cool off. One of the major ones is the number of homes Austin has been building since the Great Recession, or more accurately the lack of homes I should say. (see Time to Act: ‘The State of America’s Housing Stock Is Dire’). There are some subtle hints we’ve seen in the market the past month or so that might indicate our inventory may be increasing.
One of those is the overall activity Realtors see in our market. One of our local brokers began sending out a questionnaire to about 4,000 top-producing Realtors last December taking the pulse of what we see day to day in our businesses. I’ve shared some graphs with you in months past. His most recent poll began to reflect some comments that there is a whiff of change we’ve seen in the past month or so. Below are some comments from Realtors I selected that best reflect what I, too, have seen. Some of this may be attributable to our normal end of school year/beginning of vacation slowdown normally seen during this time. Others feel home buyers are taking a break for now so they can spend some time/money with family and are doing more things now that mask mandates are going away and we are beginning to return to some sense of normalcy after Covid-19.
- “Noticing some properties that are not selling immediately, and more price drops from seller's that pushed the market too high on initial list price. Also a few properties this past week I expected to sell in multiple offers that are still on the market.”
- “I find when homes are priced reasonably, multiple offers are easy to expect. When priced aggressively, many buyers feel like they don't have a chance and end up not bothering to offer.”
- “Seeing it cooling down, except for crazy hot neighborhoods that have always been hot in a normal market. Quantity of showings and offers are trending down, I think we are leveling out to the new normal.”
My gut feeling is that we may have reached the peak of the craziness seen all of this year and may be experiencing the beginnings of a very gradual cooling of our market that will likely take many months...most likely through the end of this year at least. Maybe, just maybe we will start 2022 with something closer to 2.0+ months of inventory. So, home buyers please have some more patience, there just might be a light at the end of the tunnel!
(512) 853-0110 or robert@AustinTxHomeSales.com
#RealEstate #AustinHomes #MoveToAustin #Relocate #RelocateToAustin #AustinHomeBuyers #AustinHomeSellers #AustinJobs #AustinRealEstate #HomeForSaleAustin #NewHomes #RealEstateMarket #AustinRedHotHomeSales