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• This year, as of today, 325 listings of $1M or more have Expired or been Withdrawn without selling, compared to the 277 that have actually sold.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.