Austin Million Dollar Homes

by Steve Crossland, REALTOR in Austin TX on November 15, 2006 · 2 comments

Below is a link to a news segment from News 42 Austin profiling the Austin real estate market for homes that cost 1 million dollars or more. The news story plays up the $1M+ market, indicating a swell of demand for homes in that range. It’s an interesting story not only about the Austin real estate market but about the amount of wealth coming into Austin and the wealth that already resides here. But are Million Dollar Homes in Austin really selling “faster than they can be built”, as the story states?

Here are some stats not provided in the story:

• As of today (11/15/2006) there are 7641 single family homes listed for sale in the Austin MLS. Of those, 395 are listed for $1M or more – about 5% or 1 out of 20 homes.

• This year, as of today, 22,757 homes have sold in Austin. Of those, 277 sold for more than $1M – about 1.2% or about 1 out of every 100 homes sold.

• This year, as of today, 325 listings of $1M or more have Expired or been Withdrawn without selling, compared to the 277 that have actually sold. For roughly every eleven $1M homes that sell, there are thirteen listed for more than $1M that don’t sell.

The news story says $1M homes in Austin are selling faster than they can be built, and that may be true in a few select subdivisions with a few builders, but the MLS stats don’t support that assesment for the market overall. 1 out of 20 listings in the Austin MLS is priced at $1M or more, but only about 1 out of every 100 actual sales are for $1M or more. There are more Million Dollar homes on the market than current demand can absorb, and more of those listings eventually fail to sell than do sell.

It’s still a good story in other respects, but it always interests me which stats and numbers news reporters choose to offer in their stories and how news stories can leave a reader or viewer with an impression that is not 100% accurate. In this case, the story might lead a viewer to think $1M+ homes are selling like hotcakes when in fact it’s still a Buyer’s Market in the million dollar range in Austin if looking at the metrics we use to determine such things.

Here is the video link
Here is the transcript if you have trouble with the video.

{ 2 comments… read them below or add one }

1 Jim November 15, 2006 at 9:54 pm

Hey Steve, interesting post. I did some of my own research and it looks like over 900 $1m+ listings have been withdrawn so far this year. I only found 120 or so that expired. In any case, that market is very odd and hard to measure. Homes often sit on the market for many months, and prices get dropped as well. Maybe some custom builders out in west Austin are selling out.

Btw, look up MLS# 4644429 you’ll have a good laugh.

2 Steve Crossland November 15, 2006 at 10:36 pm

Hi Jim,

900 sounds like a lot. I double checked and my numbers are good. Limit the search to Exp or Withdrawn, list price $1,000,000 min, and 1/1/2006 as the min dates in the exp AND withdrawn fields at the bottom. Oh, and limit it to “houses”. There are 198 withdrawn and 127 Expired so far this year.

> look up MLS# 4644429 you’ll have a good laugh.

That’s pretty funny, well.. funny/scary – an agent entering a $150M listing as a test. And it’s a mobile home to boot! {shaking my head} That sort of thing really screws up the MLS data. I emailed ABOR and they’ll delete it I’m sure.

Take Care,
Steve

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