Comments on: Austin Real Estate Market Update – July 2008

By: Steve Crossland

Steve Crossland — Sat, 23 Aug 2008 13:37:42 +0000

Out of 10,671 active homes listed for sale in the Austin MLS, 4,836 are listed as “vacant”, which is 45% of all listings.

It’s not a stat I normally look at so I’m not sure what to compare the percentage to, or if that’s a “normal” ratio, but it is a lot of vacant homes sitting on the market nonetheless. It would be interesting to see if the vacant ones sell for a lower list price to sales price ratio (indicating a more motivated seller) than the occupied homes. One would think the occupied homes are more likely to be listed by sellers who don’t absolutely have to sell, whereas the vacant homes, as you say, are providing an economic benefit to no one.
Steve

By: shireen

shireen — Sat, 23 Aug 2008 01:54:50 +0000

Yes, we always get great feedback on the house — it shows great (it has been decluttered and staged and the landscaping refreshed) I have a good agent and have been reading your blog for a long time, we’ve done all the standard things. But there is a huge overhang of newer infill houses in our area and price range, plus the downtown condos.

Regarding Aaron’s point — I think we are fairly typical, we have worked hard to put our house on the market but we don’t have to sell (no divorce, job change, death, etc). So even if we withdraw the property, we’re not really part of the shadow inventory.

A more interesting stat to track would be number of vacant properties — then no one is benefiting from the property and someone (seller, developer, or flipper) is sustaining carrying costs. A build up of vacant houses (over standard norms) would put pressure on prices

By: Steve Crossland

Steve Crossland — Fri, 22 Aug 2008 22:58:27 +0000

Hi Shireen,

Hang in there. Make sure you (your agent) get feedback from every showing, when possible.

Aaron,

One would think that the “on the shelf” listings would create an inventory glut later, but as happened when all the failed sales efforts became rental properties in 2002-2004, the upswing in the market also brought plenty of buyer to absorb the new listings. Many of the sellers pulling listings off the market were not in dire need of selling and will simply remain in the property.

Steve

By: aaron

aaron — Fri, 22 Aug 2008 19:14:22 +0000

There seems to be a hidden and growing inventory of houses waiting to be sold. These include withdrawn/expired listings and sellers who decided to wait it out before listing their property.

All the predictions of improving market conditions in Austin in 2009 seem to be ignoring this hidden backlog. I would be interested to know if anyone has properly analyzed what the true size of the number of months of inventory is compared with the amounts derived primarily from the MLS.

By: shireen

shireen — Fri, 22 Aug 2008 15:31:53 +0000

Ugh! Yes, I am living the slowdown! We’ll probably keep our house on the market for 5-6 more weeks, then take it off if don’t have a buyer.
We have had people who were very interested who decided to rent at the last moment, buy in a different neighborhood, or whose transfer/job plans fell through. We have one interested party, we are waiting for an offer, I imagine offer will be low although we have lowered our price twice (with a neighboring house stuck with a wishful thinking price). The house is a great value for the quality of the construction, energy costs are very low so if we can’t get a price that would enable us to buy elsewhere, we’ll stay put and keep our low electric bills.
The dominos might all fall into place if the seller of the home we want to buy will match our concessions to our potential buyer but with 13+ months of inventory in our central city area, there is plenty to chose from.