Austin-area home sales remain high, could signal record year for Central Texas real estate

Austin Board of REALTORS^® releases real estate statistics for October 2015.

AUSTIN, Texas – Nov. 19, 2015 – Austin-area single-family home sales increased year-over-year for the fifth consecutive month in October 2015, according to the Multiple Listing Service (MLS) report released today by the Austin Board of REALTORS® (ABoR). Austin-area single-family home sales increased by two percent year-over-year to 2,378 home sales and median price increased five percent by the same measure to $252,790 in October 2015.

Barb Cooper, 2015 President of the Austin Board of REALTORS­^®, explained, “We’re on pace for another record year and while home sales typically slow each fall, housing demand has remained strong far past the typical peak selling season. This demand stems from strong employment and our area’s high growth rate—factors that help create a stable housing market.”

In a recent Freddie Mac report, Austin was ranked the second-most stable housing market in the U.S. The report ranked Austin’s housing market as “improving,” with positive gains in employment and mortgages in good standing.

“A stable housing market bodes well for Central Texas,” added Cooper. “But we need to find ways to give more Austin-area homeowners access to that stability by increasing our density, preserving our existing housing stock through stronger code enforcement and creating more affordable housing options.”

New listings remained unchanged year-over-year at 2,847 listings and active listings increased by three percent compared to October 2014 to 6,342 listings. In addition, pending sales increased four percent to 2,339 single-family home sales. Homes remained on the market for an average of 50 days in October 2015, one day fewer compared to October 2014.

Monthly housing inventory decreased by 0.1 months year-over-year to 2.6 months. Housing inventory remains at less than half of what the Real Estate Center at Texas A&M University considers a balanced housing inventory level of approximately 6.5 months.

October 2015 Statistics

• 2,378 – Single-family homes sold, two percent more than October 2014.
• $252,790 – Median price for single-family homes, five percent more than October 2014.
• $333,452 – Average price for single-family homes, seven percent more than October 2014.
• 50 – Average number of days single-family homes spent on the market, one day fewer than October 2014.
• 2,847 – New single-family home listings on the market, statistically unchanged compared to October 2014.
• 6,342 – Active single-family home listings on the market, three percent more than October 2014.
• 2,339 – Pending sales for single-family homes, four percent more than October 2014.
• 2.6 – Months of inventory* of single-family homes, 0.1 months less than October 2014.
• $792,948,856 – Total dollar volume of single-family properties sold, 10 percent more than October 2014.

The following sections describe trends in other sectors of the Austin-area real estate market.

Townhouses & Condominiums

The number of townhouses and condominiums (condos) sold in the Austin area in October 2015 was 230, a 15 percent decrease from October 2014. The median price for condos was $234,680, which is four percent more than the same month of the prior year. These properties spent an average of 48 days on market, unchanged from October 2014.

Leasing

In October 2015, a total of 1,384 properties were leased in Austin, which is one percent more than October 2014. Properties spent an average of 41 days on the market, or two fewer days than in October 2014. Active property listings increased by five percent compared to October 2014, reaching 1,891 listings.

The Austin Board of REALTORS® (ABoR) builds connections through the use of technology, education and advocacy to strengthen the careers of its 11,000 members and improve the lives of Central Texas families. We empower Austin REALTORS® to connect their clients to the region’s most complete, accurate and up-to-date listings data. For more, contact the ABoR Department of Public Affairs at marketing@abor.com or 512-454-7636. For the latest local housing market listings, visit AustinHomeSearch.com.

* The inventory of homes for a market can be measured in months, which is defined as the number of active listings divided by the average sales per month of the prior 12 months. The Real Estate Center at Texas A&M University cites that 6.5 months of inventory represents a market in which supply and demand for homes is balanced.

LESSONS LEARNED

Anyone who knows me well knows that I love telling stories.  Granted some may be pretty corny, but I guess that comes with the territory.  On the other hand, I have found that stories are the best way to convey the benefit of my experience without insulting clients.  Not all of the stories are original with me.  I am not above latching on to a good story if it is the perfect way to illustrate a concern or make a subtle suggestion to a client. Here are a few of my favorites.

THE RULE OF NEXT

My friend Jim had a million dollar house listed during the Dot.com bust.  It was vacant and the seller needed to get out from under the weight of the payment.  The house was priced competitively and was on several buyers’ “short list,” but was repeatedly overlooked.  Jim met with the seller and explained that they must be priced right; after all, they were in consideration by several buyers.  The seller pointed out that being “close” did him absolutely no good.  He wanted to be NEXT.  He instructed Jim to figure out what the price point had to be in order to beat all the other competition so that his house was the very NEXT one to sell.  It is a simple concept, but too many sellers ask to be completive when they really need to be NEXT.

I’LL  SHOW ME.

This was another of Jim’s clients.  Jim’s client had made an offer on a home.  The sellers had made a counter-offer that was both insulting and financially acceptable at the same time.  Jim dreaded presenting the counter offer because he was concerned about how his client, a rather strong personality, would react to the news.  Sure enough, the client was irritated at first, but he then said, “OK, that is fine.”  Jim was shocked and it showed on his face.  The client picked up on Jim’s concern and told him something that became one of our favorite phrases.  He smiled and said, “I decided years ago that life is much better when I am not always saying ‘I’ll show me!”

WOULD YOU BUY IT BACK?

When I first started in real estate, I read an article about another young agent. The article described an actual event where the new agent successfully closed a deal with a simple question . . . a very important question.  It is a question I have posed many times and often asked myself when I was building.

The new (but savvy) agent received a low offer on one of his first listings.  The seller refused it out of hand, even though he strongly wished to sell the property.  The young agent posed this simple question to the seller.  “Mr. Seller you have stated that you will not consider this current offer because it is too low.  In that case if I can find a similar house in the neighborhood for the same price as this offer, will you buy it? No? Well with all due respect, that is exactly what you are doing by turning this offer down.  In essence you have bought it again, speculating that you can make $X in the next month or so.  That is really no different than buying a different house in the neighborhood and gambling that you can make more money on a later sale.

After all these years, I still find that question cuts through the clutter to the heart of the matter.  As a spec home builder, I posed that question to myself many times.  It is a great acid test for sellers.

Jeff Stewart, CCIM  Stanberry Commercial., REALTORS

jstewart@stanberry.com