Austin Real Estate Market Update – Dec 2007

Austin real estate market stats for single family homes in Dec 2007 saw a 20% drop in number sales of over Dec 2006. Average sold prices were up 5.9% and Median sold prices were up 7.8% in December. Average sold price per square foot is up 4.4% over a year ago, and Days on Market inched up from 64 days a year ago to 69 days this December.

Overall in Austin, the market has held very steady and price appreciation is strong in many areas. The main caveat is the high inventory and the resulting high number of homes that fail to sell. If you saw my Sold vs. Not Sold chart from a few days ago, you know that in December 2007, more homes in the Austin MLS expired or were withdrawn than sold. So even though our sold numbers look strong and steady (especially when compared to just about anywhere else in the country), a seller at present should know that it’s a hit or miss market that requires serious preperation and proper pricing for your listing, lest it be ignored and whither on the vine like so many others.

Buyers, with all of these homes not selling, should you be able to get a great deal? Not necessarily. The fact that so many homes are being pulled from the market, and that the actual sold prices keeps rising, tells us that many sellers remain steadfast in holding out for a better price or a better market. Theoretically, you should be able to negotiate a better deal, and you may do so, but in reality, we are not seeing a high degree of seller capitulation.

Below are the December stats and year-to-date stats (2007 compared to 2006). Normally along with December stats I include the area breakdowns year-to-date. This year I will post those in a separate blog article, as I am still trying to finish up. The new MLS system has really slowed down the process for me. Also, you may notice that the Median values are missing below from some of the charts. I can’t get a median value from our MLS system on search results larger than 5,000. Hopefully, that will be fixed soon.

Austin Sales Stats December 2007
Previous Month and Year Comparison
All MLS Areas - Houses Only

 
Nov 2007
Dec 2007
Dec 2006
Yr % Change
# Sold
1527
1533
1928
-20%
Avg List Price
$266,062
$267,290
$250,143
6.7%
Median List Price
$197,500
$199,900
$182,900
9.3%
Avg Sold Price
$255,073
$256,726
$242,326
5.9%
Med Sold Price
$188,900
$194,000
179,900
7.8%
Avg Size SQFT
2151
2168
2145
1.1%
Median SQFT
1951
1983
1960
1.2%
Avg $ per SQFT
$119
$118
$113
4.4%
Avg Days on Mkt
68
69
64
7.8%
Median Days on Mkt
46
51
44
16%

Below is the 2006/2007 full year comparison. For the year, across all MLS areas in Austin, sold prices rose 6.6%, which is really very good considering the gloom and doom story that the media puts out and the fact that a lot of buyers stayed in the sidelines because of that.


Austin YTD Sales Stats December 2007
Year to Date with Previous Year Comparison
All MLS Areas - Houses Only

 
Jan-Dec 2006
Jan-Dec 2007
Yr % Change
# Sold
26,346
24,453
-7.2%
Avg List Price
$245,403
$262,679
7.0%
Median List Price
-
-
-
Avg Sold Price
$239,056
$254,883
6.6%
Med Sold Price
-
-
-
Avg Size SQFT
2112
2166
2.6%
Median SQFT
-
-
-
Avg $ per SQFT
$113
$118
4.4%
Avg Days on Mkt
58
57
-1.2%
Median Days on Mkt
-
-
-

Below are the YTS sales stats after excluding new home sales from the MLS search. Notice that when we remove new homes, the appreciation rate jumps from 6.6% overall to 8%. There is something fishy about these numbers though. You’ll notice on the New Homes Only chart below that the new home sales appreciation is even higher. I’m not sure how the combined appreciation rate of all Resale/New can be less than each of the individual rates, except to say that each sample is leaving out listings that are not properly flagged as “Resale” or “New or To be Built” in the MLS. I’ll look into this further later.

Austin Sales Stats (resale) Jan-Dec 2007
Year to Date Previous Year Comparison
All MLS Areas - Resale Houses Only - (New Homes Excluded )
 
Jan-Dec 2006
Jan-Dec 2007
Yr % Change
# Sold
20330
18136
-11%
Avg List Price
$233,354
$252,105
8%
Median List Price
-
-
-
Avg Sold Price
$227,885
$245,908
8%
Med Sold Price
-
-
-
Avg Size SQFT
2062
2075
0.6%
Median SQFT
-
-
-
Avg $ per SQFT
$111
$119
7.4%
Avg Days on Mkt
52
49
-5.8%
Median Days on Mkt
-
-
-

Finally, below is a chart showing only the new homes that sold through the Austin MLS. Note that the sales prices and days on market are much higher than the resale market. The new homes skew our overall stats in those areas, which I why I decided to start pulling them out and looking separately.

Austin Sales Stats (new homes) Jan-Dec 2007
Year to Date Previous Year Comparison
All MLS Areas - New Houses Only - Sold thru MLS
 
Jan-Dec 2006
Jan-Dec 2007
Yr % Change
# Sold
1242
891
-28%
Avg List Price
$371,886
$421,598
13%
Median List Price
$258,692
$294,900
14%
Avg Sold Price
$361,245
$405,016
12%
Med Sold Price
$249,350
$282,000
13%
Avg Size SQFT
2714
2825
4.1%
Median SQFT
2545
2628
3.3%
Avg $ per SQFT
$133
$143
7.5%
Avg Days on Mkt
106
110
3.8%
Median Days on Mkt
85
86
1.2%

Stay tuned for the area breakdowns which I will post soon.
As always, comments and questions are welcome.

Posted by Steve
8 years ago
Steve

Steve is a Real Estate Blogger, Husband and Dad, UT Austin Grad, Runner, Real Estate Broker and owner of Crossland Team and Crossland Real Estate in Austin TX.

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Ray - 8 years ago

re: unsold inventory. I agree with your comment that there is not a lot of seller capitulation. Many areas of the the Austin market, including close in to downtown, are still quite drastically underpriced when considering the quality of life available, and when comparing how much that QOL would cost in other parts of the nation and the World. The one obstacle to sales in Austin is crazy high property taxes (though no state income tax), but prices will not fall because of that. Many ‘unsold’ sellers are just testing the waters and happy to lease or wait – whilst enjoying their location – until prices catch up with reality and the Statesman gets a grip with pumping out misleading negative headlines for local real estate. Many local buyers are stuck thinking about the good old days when MOPAC and 183 was a stop light and prices were ridiculously low. Compare prices here to London or Paris or San Francisco and you can still buy a beautiful mansion here if you sell a small normal house there – and many would say the QOL is better here…. as many are now realizing.

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Mike - 8 years ago

Ray, last time I checked Austin wasn’t London or Paris or San Francisco. Unless we get the job opportunities and salaries that those cities afford here in Austin, prices will never approach the price levels in those cities.

Also, property taxes act as a natural buffer to price increases here in Austin. If the average condo goes for $750k here in Austin like it does in San Francisco, people would need to be able to afford the approx $25+ a year in property taxes (not to mention condo fees) that come along with that. That means 200k+ a year jobs are needed in great numbers to support the property values in your fantasy.

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shireen - 8 years ago

Yup!
High property taxes are the main reason that we temper our real estate desires!

We are financially conservative and like to own most of the equity in our house but high property taxes are not all bad. I think that they are a major reason that Texas avoided the worst of the housing bubble. You can get a liar NINJA loan for a million bucks but that won’t help you pay the tax bill on that mansion (or downtown condo), year after year.

Reply
Ray - 8 years ago

Mike,

All just my opinion of course, but based on having spent a considerable time living elsewhere (in those other places) too…

Although Austin doesn’t yet have the international ‘panache’ of London, San Fransisco, etc, it is certainly not far behind. Also, where would you rather live? Yep, SF is surrounded by beauty….and next to a frigid shark filled ocean, and has frigid lakes and mountains a long drive inland – but my point is that we are surrounded by beauty too, and in fact more of our natural assets are useable everyday by residents. We have beautiful beaches in South Padre a few hours drive away, the expansive hill country, a wine country (growing rapidly), a lot of watering holes and substantial lakes with warm clean water, etc, etc…and gorgeous weather. Compared to many of these well know places with high priced real estate central Texas is a paradise. Austin was not at all well known 20 years ago, but now probably at least 25% of European adults have heard about it and have heard very good things.

About wage levels. Median wages in London (city of approx 20 million) and Paris are, I am quite sure, significantly lower than in Austin, yet average price per square foot is still very much higher there. I’m not saying this is good (I’d like to buy my piece of paradise too) – I’m just referencing the fact that those *very* affordable times of 10+ years ago here are becoming a thing of the past here now that we are on the map and growing rapidly. All the best.

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