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Here are the August/2022 MLS single-family statistics for Austin, TX:
A continuation of mostly red categories in August for Austin area home sales as we’ve seen for the past several months. There is a definite slowdown in sales activity as I’ve mentioned but the jury is still out as to where we are headed…is this a bubble, or just a temporary slowing/leveling of our market? I’m in the latter camp as I don’t see a bubble, mainly due to our low inventory (see also “Costly Housing” article below). For instance, look at the 2 charts below: Sales Price Appreciation and Months of Inventory which represent, arguably, the most important metrics in any real estate market.
For sale price appreciation, you can see below that we’ve had double-digit increases every year or month, except for a couple of times since Covid-19. While prices have slowly dropped throughout 2022, they actually ticked back up in August to 10% from 8% in July for average prices and our median prices were 6% in each month. For instance, an average-price seller in August got $60,158 more than Aug/2021 sellers received. And, we are at 15% average and 17% median prices YTD which are both higher than 2020. Looks like we are coming in for that soft landing as I mentioned in previous newsletters.
Reviewing the months of inventory, below, shows that we dropped each year from 2019 (pre-Covid) to 2021 and are at 1.50 months for our 2022 YTD average. Considering a market in equilibrium (neither seller nor buyer has an advantage) is 6.0 months, we have been at half that number the past 2 months.
Having said all the above, keep in mind that the August/2022 stats were just published today, 9/15/22 so they are 2-weeks in the past and many of the sales numbers were for homes that went under contract in July. What we, Realtors, have seen since that time is of concern, however. While the months of inventory only went from 3.10 in July to 3.20 in August, lately we are seeing much lower activity from home buyers like inquiries and home showings. Some of this is due to much higher mortgage interest rates, inflation taking more $$$ from buyer’s pocketbooks in monthly expenses, apprehension about a potential recession, and even the upcoming national mid-term elections (which usually have some effect on our market every 2 years). Now, more than ever before, home sellers should price their home “to the market”--what it will look like in the coming months, not based on the past–to have the best chance of getting it sold.