Take a look at this chart showing the number of homes that go under contract, or “Pending”, in Austin each month over the past several years. The green line is 2010. I could almost stop writing at this point and just let the chart tell the entire story. But have a careful look at the Austin real estate market behavior for the past several years, and then see what our government caused to happen in April and May with the $8K tax credit.
The writing was on the wall last month when I wrote about the Tax Credit Effect on the Austin Real Estate Market. We had a record number of homes go Pending in April, and May was looking pretty slow, and that didn’t change. So we end up with a record high followed by a record low month in terms of number of homes going under contract.
And in June, the hangover persists. As we head into the last weekend of what is historically the second busiest month of the year, the Austin real estate market is getting ready to lay another rotten egg. Thanks Tax Credit, for sucking the life out of the market, even with interest rates yesterday at 50 YEAR LOWS!. At present, we have about 1250 homes that have gone Pending in June, so even if we have a brisk next 6 days, you can look at the chart and see that June will remain substantially below the expected level under normal conditions.
What does this look like out in the field?