Austin Real Estate Market – April 2008 Sales Update

The Austin real estate market average sales values fell in April 2008 compared to the year before, yet there remain many areas in Austin with strong sales. The average sales price of an Austin home in April 2008 is $245,483. Last year in April it was $254,846. That’s a price drop of 3.67% overall, but further below I’ll explain how this is misleading and that 75% of the MLS areas in Austin have appreciating values, many over 10%.

Median sold price is up 0.53% from $188,000 a year ago to $189,000 this year. See the chart below and a further rundown on what’s happening in the Austin real estate market below.

Austin Real Estate Market Update for April 2008
All Austin / Central TX MLS Areas – Houses Only

Mar 2008
Apr 2008
Apr 2007
Yr % Change
# Sold
1736
1826
2227
-18.01%
Avg List
$252,657
$254,318
$260,935
-2.54%
Med List
$197,478
$194,935
$189,900
2.65%
Avg Sold
$242,395
$245,483
$254,846
-3.67%
Med Sold
$190,000
$189,000
$188,000
0.53%
List/Sold %
95.94%
96.52%
97.66%
1.12%
Avg SQFT
2130
2117
2087
1.44%
Med SQFT
1949
1924
2120
-9.25%
Avg $ SQFT
$114
$116
$122
-5.04%
Avg DOM
69
63
55
14.55%
Median DOM
45
39
26
50.00%
# Expired
551
519
296
75.34%
# Withdrawn
481
586
412
42.23%
Not Sold
1032
1105
708
56.07%
Not Sold %
37%
38%
24%
56.29%
On the Market as of May 19 2008:
12,066 = Active Res Listings in Austin MLS (11,522 last month)
9942 = Total Single Family Homes listed (9410 last month)
2026 = Condo/Townhome/Loft/Garden Homes listed (1845 last mo.)
97 = Mobile/Manufactured Homes (267 last month)

The Austin real estate market continues to be sluggish for April 2008 overall, according to our stats, but with many well performing pockets. Number of sales dropped 18% from the same month a year ago. Average list price is down 2.54%. Average sold price, as noted above, dropped 3.67% year over year for April. This is the second month in a row with a 3% drop in average sold price. Median Sold price is up half a percent.

For April, listings sold for 96.52% of the list price, about the same as last month but 97.66% last year. Average sold price per square foot is down 5% from $122 last year to $116 this April. Days on market has increased to 63, which is still a good days on market number.

Finally, the Sold vs. Not Sold ratio is up 56% from last year. Last month the increase was 43%, so this seems to be heading the wrong direction, meaning more sellers are failing to sell their listed homes and instead withdrawing or letting the listing expire. In April 2008, 1,826 homes sold through the Austin MLS, and 1,105 were withdrawn or expired, which was 38% of all disposed listings. A year ago it was 24%.

Let’s look at the Year to Date stats for 2008 compared to 2007.

Austin Real Estate Market Update for April 2008
All MLS Areas – YTD Apr 08

Jan-Apr 08
Jan-Apr 07
Yr % Change
# Sold
6349
5382
-17%
Avg List
$253,504
$252,052
-0.45%
Med List
*
*
*
Avg Sold
$245,262
$244,483
-0.91%
Med Sold
*
*
*
Sold/List %
96.75%
97.00%
-0.46%
Avg SQFT
2123
2094
1.00%
Med SQFT
*
*
*
Avg $ SQFT
$115
$117
-1.89%
Avg DOM
68
64
11.48%
Median DOM
*
*
*
# Expired
2147
1322
62%
# Withdrawn
2194
1621
35%
Not Sold
4341
2943
48%
Not Sold %
41%
28%
46%
* Our MLS software won't provide a Median for over 5,000 results

Year to date the market in Austin remains down slightly from a year ago. The main headwinds we face in having more sellers than buyers are twofold. First, purchase loans are harder to get not only for buyers with credit blemishes but also for those with great credit who need no-doc or low-doc loans. Second, the emotional component that keeps ready buyers on the fence because of the fear that the market will drop after they buy.

In other words, many buyers hope to time the market, waiting for a better moment to buy a home. This in turn causes the market to be slower than it would be otherwise, which in turn causes slower sales and softer appreciation, which then allows those “on the fence” buyers to say “see, I told you I should wait”. It’s a self-fulfilling prophecy.

Meanwhile, there is something else important to note. Many areas of Austin continue to see strong price increases. If you check my stats breakdown by MLS area for the first quarter of 2008, you’ll see that many MLS areas in Austin saw positive appreciation. Here is the breakdown per area:

11 = Number of Austin MLS areas with average sold price drops Jan-Mar 2008 from the year before.
9 = number of MLS areas with 0% to 4.99% appreciation.
11 = number of areas with 5% to 9.99% appreciation.
12 = number of areas with more than 10% appreciation first quearter 2008 compared to 2007.

So, for every MLS area in Austin where prices dropped, there were roughly three areas where prices increased. Buyers (on the fence) who look at overall market stats but not at the particular Austin area in which they wish to purchase, will succeed only in waiting while the price goes up and possibly the interest rate as well.

The reason that a small number of areas with price drops can pull down the average sold price stats for the entire MLS is that the areas with falling prices include two of the most expensive areas in Austin. Those are area 8E and 8W in Westlake.

Area Avg Sold 08 Avg Sold 07 % Drop
1B $691,153 $693,372 -0.32%
8E $866,681 $1,111,053 21.99%
8W $521,090 $644,487 19.15%
HD $347,954 $357,549 2.68%
RN $526,300 $546,103 3.63%
RRW $236,548 $240,603 1.69%
SC $182,760 $201,736 9.41%
SWE $219,580 $222,615 1.36%
UT $385,850 $460,545 16.22%
W $491,873 $545,934 9.90%

When I run YTD stats and simply exclude areas 8E and 8W, instead of the Austin market being down about 1% from the year before, it’s up 1% from the year before.

So, the takeaway is that the overall market direction is important to observe and know, but each individual neighborhood and area performs at it’s own level, and each individual homes sells for its own price, which at present is more likely than not to be a higher price than the market would have delivered a year ago.

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.

Click Here to Leave a Comment Below

Doug - 8 years ago

There must be a type-o in your breakdown by MLS for area 1b

1B $347,954 $693,372 -0.32%

Reply
Steve - 8 years ago

Thanks for catching that Doug. I fixed it. Should have been $691,153 instead of $347,954.
Steve

Reply
Ray - 8 years ago

“Austin area home sales fall for 10th month in a row” is the May 20th story title in Austin Statesman real estate section. Of course the majority of advertorial national media like USAToday are also still printing similar very misleadingly alarmist negative headlines about US real estate. Even the minority of areas that are down are way up over a reasonable investment timescale.

As for Austin realty reality… the stats show very healthy appreciation in most areas lending no support whatsoever to the above story title. The Statesman story fails (of course) to mention the healthy increases in the majority of Austin real estate sold prices. It’s as if these outfits just recycle each other garbage “news” and print it.

Happy Memorial Day..

Reply
Leave a Reply: