Sales volume continues to drop year over year in Austin while prices continue to rise. Let’s have a look at the chart below.
|Austin Real Estate Sales Monthly Update – Oct 2010|
|Homes only (condos, duplexes, etc. not included) compiled from Austin MLS data|
|Sep 2010||Oct 2010||Oct 2009||Yr % Change|
|Avg $ SQFT||$113.12||$116.53||$114.18||2.05%|
|Not Sold %||58.63%||59.98%||42.14%||42.34%|
The number of homes sold dropped 36% from Oct a year ago, but remember, a year ago in Oct we all thought the government tax credit for new buyers was going to end in Nov 2009, so we had artificially increased demand for the fall/winter selling season. Nonetheless, it’s a 36% drop, which is huge. We’re going to see similar year over year drops in the March-Jun stats in 2011 too. In fact, it will be more than two years from now before I can run stats that don’t include the caveat “remember a year ago the government was meddling in the real estate market, or we were in the tax credit hangover, and thus …”
Let’s talk about the color coded right column. This is the first time ever that the spreadsheet I pasted into a blog article maintained the color coding that I have programmed in. Essentially, green indicates a metric that moved in a positive direction, and red is a metric moving in the negative direction. We could have a long debate about whether and why higher prices are “good”, because for buyers maybe lower prices are better. But for the economy in general, jobs and growth, the real estate market needs to be appreciating and growing, so for the purposes of my stats, “good” means it’s good for the owners and sellers of real estate because values are rising.
Don’t give too much credence to the high upward swings in the green rows. Those are distortions. The typical 4 bedroom 2,000 sqft 10 year old home in Austin is not worth 11% more than it was a year ago. We’re simply seeing more expensive properties sell while last year it was the lower priced homes driving the market because of the tax credit.
Let’s have a look at the year to date stats.