For about 4 years now I’ve been posting all of our listings in Austin Craigslist. It seems like once upon a time, a long, long time ago, I received a call or two, and even a bonafide lead from one of our Craigslist property listing ads. I honestly can’t remember the last time it’s happened though. Must be more than two years now.
Usually all I get is a) spam, b) scam attempts or c) emails from other Realtors wondering if they can advertise our listing on Craigslist as a buyer agent. All three of these have zero value to me.
My general comment to clients when talking about the things we do to market a home for sale or lease in Austin is “..we also place it in Craigslist, which doesn’t ever generate any calls, but it’s free so we put it there just in case”.
So, if we’ve received no results at all from placing listings in Craigslist, is “it’s free” a good enough reason to keep doing it?
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Steve and I have a few listings that have not had as much “traffic” as we would like, so the last few weeks I held open houses in a couple of our vacant staged listings just to get a feel for foot traffic in the neighborhoods and to hear what buyers are saying.
The first week, I held an open house at our Lost Creek listing at 1601 Bay Hill Drive. I placed several signs at the entrance to Lost Creek at Hwy 360, as well as numerous corners in Lost Creek, which brought in a lot of traffic.
The Lost Creek open house went better than I expected. There were 15 groups of people in 3 hours. It was really hopping! Normally a turnout of 5 to 8 people is considered “decent” on an open house, especially given the fact that sometimes the turnout can be zero. This was the first weekend of South by Southwest (SxSW Austin), so the atmosphere was lively and upbeat and people seemed to be enjoying being out and looking around. There were people from Denver and some from California that are planning to relocate to Austin. They all told me how “amazing” the prices are here in Austin. “Do you know how much a house like this would sell for in California?” Of course I’ve heard this before, and I know the listing I have in Lost Creek priced at $439k would be $1M+ in many parts of California.
The Lost Creek open house also drew several groups from Austin, many who are currently renting but out looking to see what’s available. Most of the attendees already have Austin agents they are working with. Of the four attendees who told me who their Austin Realtors were, I called all four agents to let them know their buyers seemed interested in the house and to invite them back for another look. I don’t know if this will produce a buyer, but I feel like I have to be doing everything I can to generate something.
I prepared the graph below for a presentation I did last night to a local Austin real estate investor club. I’ve been commenting to buyers and sellers lately that the Austin real estate market has been “drawing W’s”, which is to say that average sold prices have been taking big swings up and down each month. I decided to put the price swings in graph form to illustrate what I’m talking about. Let’s take a look.
Do you see the W? From August to September 2008, Average sold price dropped over $10K in one month (from high $250s to mid $240s), then it rose slightly in Oct (start of W), then dropped almost $10K again in Nov from mid $240s to the $230s, then jumped over $10K in December back into the $250s, dropped over $10K in Jan back to the mid $230s, then up more than $10K again in February back into the $250s.
I asked the audience of experienced Austin investors at the meeting last night if anyone had an opinion about which direction we’ll see it go in March, and nobody claimed to know. Neither do I. But let’s look at some more stats.
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There is an article in the Sept/Oct edition of the Austin Apartment Association magazine “Window on Rental Housing”, written by Austin Attorney Bill Warren, which addresses the growing problem in the apartment industry of rouge reviews and rants about apartment complexes and the management.
As a renter moving to Austin, you can go online and find reviews about the various apartment complexes. There isn’t a central repository of reviews, or a website that dominates this niche, but there are numerous websites trying to capture this market. These are not generally glowing reviews. The ones that are favorable often don’t seem genuine because they’re just a bit too gushy, so one wonders if the apartment personnel wrote some of those.
I’ve found a smattering of reviews about Austin Realtors as well.
Not surprisingly, most Realtor reviews are unfavorable. Sylvia and I solicit our own reviews from clients after every deal via a survey we mail out. We post them on our website (though I need to update that page). We’ve never received a bad review.
But because we also manage rentals, we are subject to the rants and anger of tenants. Just yesterday one of my tenants called to say he needs to break his lease. I explained what the lease agreement says about that, and what needs to happen to remain in integrity with the lease agreement, and of course, as usual, it went down hill from there.
“I knew you were going to be difficult to deal with”, the tenant said. To which I replied, “Whoa, hold on there. What are you being asked to do that you didn’t already agree to when you signed your lease contract?”.
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The average and median sold prices in Austin are up for February 2009. Average sold price is up 6.29% from Feb a year ago and median sold price is up 2.65% from last year. Last month (Jan 2009) you might remember sold prices had dropped about 5%. So the Austin market is “undulating” a bit, sort of like the stock market except that we’re now actually up YTD for the same period 2008 as well.
Volume of sales dropped 25% for Feb compared to Feb 2008, but that’s an improvement from the volume drop of 40% in Jan. The number of “Not Solds” (expired or withdrawn) is at 50% for February, meaning half the listings that departed the MLS were failed sales efforts. Let’s look at the breakdown of the rest of the Austin single family home sales for Feb 2009:
• Number of homes sold is down 25% (was down 40% last month) from 1,315 Feb 2008 to 989 Feb 2009.
• Average list prices in Austin were up 6.89% over the same month last year to $264,044.
• Average sold prices in Austin were up 6.29% over the same month last year to $252,132 from $237,218 a year ago.
• Median sold price was up 2.65% to $194,000. Last year in Feb it was $189,000.
• Average List to Sold price ratio is 95.49%, down slightly from 96.00% the same month last year.
• Avg sold price per square foot is up 0.18% to $114.04 compared to $113.83 a year ago in Feb.
• Avg days on market is up 12 days (18.75%) from 64 last year to 76 this November.
• Median days on market is up 15 days (20%) from 69 days last year to 83 Feb this year.
• Number of “Not Sold” (exp or withdrawn) is up 20% over the same month last year, to 50% of all removed listings compared to 42% for the same month last year. This is actually a fairly healthy drop from the 61% Not Sold ratio in Jan and the 58% in December.
Most of this is favorable, but it would be foolish to think one month means anything. We would need to see a sustained trend upward, for three months in a row leading into the summer, accompanied by better economic news nationally, before I’d get too excited about the Austin market. Still, as real estate markets go, Austin is stubborn and is hanging in there better than almost any other city in the U.S.
The stats outlined above are shown in the chart below.
|Austin Real Estate Sales Market Update|
|Homes only (condos, duplexes, etc. not included) compiled from Austin MLS data|
|Jan 2009||Feb 2009||Feb 2008||Yr % Change|
|Avg $ SQFT||$108.38||$114.04||$113.83||0.18%|
|Not Sold %||60.98%||50.00%||41.76%||19.72%|
The year to date chart is below, showing how we’re doing through Feb 2009 compared to Jan-Feb 2008.
It’s called a “buyer’s market” because real estate buyers have a market advantage over sellers. The buyer advantage is a result of high inventory and lower demand. Buyers have a lot of Austin homes to pick from, and there are more homes for sale than there are buyers to buy them. This means Austin buyers should be getting great deals, right? Wrong. Many don’t.
Many buyers give away their buyer’s market advantage in favor of indulging a highly particular and restrictive set of search criteria. In other words, some buyers are looking for the “perfect” house, and once they find it, they are not willing to walk away even if the seller stubbornly holds out for a higher price than market conditions should bring.
The buyer doesn’t have a strong #2 or #3 choice to move on to. Instead of enjoying the benefits of an ample selection of homes, some buyers create their own artificial shortage of homes by ruling out adequate candidate properties, and thus limiting their options, and thus their negotiating leverage. So long buyer’s market, for those buyers.
Many sellers might be saying, “yeah, well bring me one of them there picky buyers because we’re priced too high and we need to get lucky”. Well, some of you will. Not many of you, but enough to keep the others hoping.
Here’s the thing if you’re a buyer in Austin….
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