Austin Real Estate Market Update – Dec 2008 and Year End

The Austin real estate market for December 2008 ended better than I predicted. The Austin market held up well throughout 2008, all things considered, and within the context of the national economic climate and the fierce headwinds created by fear and negative consumer sentiment. Before we get into the December stats, the YTD stats and the MLS area breakdowns, let’s take a quick look at the graph below to get a perspective on how the Austin real estate market has performed since 1999.

sales-graph-1999-2008


As you can see above, even though 2008 is down a bit from 2007, it’s not anywhere near the nose dive that most of the rest of the country has experienced. In fact, viewed on the 9 year graph, the small dip is no big deal. It has to be noted that both 2006 and 2007 saw price appreciation of just below 10%, both years setting new record high prices in Austin. Each succeeding year cannot be a new record. Real Estate markets do not produce straight upward sloping lines over time, nor should that be the expectation, so it somewhat puzzles me the degree of concern we hear from buyers and sellers when the market does what it’s suppose to do, but that’s what we’re hearing a lot of lately.

Relax, 2009 may be slightly down as well. But real estate is a long term investment, not a lottery ticket or an ATM machine, as folks came to view it during the early through mid 2000’s. Moving on. Below is the December 2008 stats summary as well as the 2008 vs. 2007 sales comparison and breakdowns by MLS area. First, let’s see how December did.

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Austin Real Estate Market Update – Nov 2008 Sales

The sales volume in Austin fell of a cliff for November, with only 914 sales of single family homes. That represents a 43% decline in the number of homes sold. The number of “Not Solds” (expired or withdrawn) took a big jump also, to 62% of all listings that departed the Austin MLS in November. If you remember last month’s market update, I predicted the Not Solds will hit 70% in December 2008. November stats haven’t changed my mind.

Let’s look at the breakdown of Austin single family home sales for November 2008:

• Number of homes sold is down 43% (was down 28% last month) from 1,594 Nov 2007 to 914 Nov 2008.
• Average list prices in Austin were down 5.29% over the same month last year to $250,609. This means sellers/agent are doing a better job of pricing the home correctly out of the gate.
• Average sold prices in Austin were down 6.17% over the same month last year to $238,072 from $253,718 a year ago. So, list prices are down 5% but sold prices are down 6%, which tells me sellers are still chasing the market down.
• Median sold price was down 1.87% to $185,000. Last year in Nov it was $188,527. Median prices had been holding their own each month this year, so the downturn in this particular metric is something new.
• Average List to Sold price ratio is 95.00%, down from 95.89% the same month last year, again demonstrating that sellers are still chasing the market down.
• Avg sold price per square foot is down 7.41% to $109 compared to $118 a year ago in November. This is a huge drop.
• Avg days on market is up 12 days (18.75%) from 64 last year to 76 this November.
• Median days on market is up 11 days (24%) from 45 days last year to 56 this year.
• Number of “Not Sold” (exp or withdrawn) is up 43% over the same month last year, to 63% of all removed listings compared to 46% for the same month last year.

None of this is favorable if what we want is a normal, rising market, but in the context of elswhere in the country, it’s actually pretty good.

The stats outlined above are shown in the chart below.
 

Austin Real Estate Sales Market Update – Nov 2008 Sales
Homes only (condos, duplexes, etc. not included) compiled from Austin MLS data

Oct 2008 Nov 2008 Nov 2007 Yr % Change
# Sold 1249 914 1594 -42.66%
Avg List $258,869 $250,609 $264,601 -5.29%
Med List $199,900 $192,000 $195,955 -2.02%
Avg Sold $247,383 $238,072 $253,718 -6.17%
Med Sold $195,500 $185,000 $188,527 -1.87%
Sold/List % 95.56% 95.00% 95.89% -0.93%
Avg SQFT 2160 2180 2151 1.35%
Med SQFT 1988 1984 1952 1.64%
Avg $ SQFT $114.53 $109.21 $117.95 -7.41%
Avg DOM 69 76 64 18.75%
Median DOM 50 56 45 24.44%
# Expired 667 662 558 18.64%
# Withdrawn 1068 833 810 2.84%
Not Sold 1735 1495 1368 9.28%
Not Sold % 58.14% 62.06% 46.19% 34.37%

So, are these grim numbers cause for alarm? Not at all, and here’s why.

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Austin Real Estate Market Update – July 2008

The average sales price for houses in Austin in July 2008 remained about level, decreasing slightly (0.05%) to $262,114. The number of failed sales efforts (expired or withdrawn) was 42%, which is a large number. Days on market continues to climb also, to 60 days average on market and 39 median days on market. Those numbers are not bad actually, but last year DOM was 51 and 31, so things are definitely slower this year.

Here is a quick summary of the July stats.
• Number of homes sold is down 24% from 2,544 July 2007 to 1,926 July 2008.
• Average sold prices in Austin were down 0.05% over the same month last year to $262,114.
• Median sold price was up 3.65% over the same month last year to $199,000.
• Avg sold price per square foot is down 2.62% from July 2007 to $121 per sqft.
• Avg days on market is up 9 days (18%) from 51 last year to 60 this July.
• Median days on market is up 8 days (26%) from 31 days last year to 39 this year.
• Number of “Not Sold” (exp or withdrawn) is up a whopping 56% over the same month last year, to 42% of all removed listings.

Below is the chart with these stats, along with a YTD chart.

One thing to note is that it was about this time last year, or a bit earlier, when we really started to notice the Austin real estate market slowing down. Because of that, I think moving forward we’re going to see the year over year gaps narrow somewhat as we move into comparing a slower period 2008 to a slower period 2007. In other words, we’re a year into our Austin lull, so were not comparing a hot market for the year prior to a cool market as we have been for about the past year.

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

Jun 2008
Jul 2008
Jul 2007
Yr % Change
# Sold
2032
1926
2544
-24.29%
Avg List
$274,504
$271,058
$269,722
0.50%
Med List
$209,000
$203,443
$196,250
3.67%
Avg Sold
$264,653
$262,114
$262,233
-0.05%
Med Sold
$202,000
$199,000
$192,000
3.65%
List/Sold %
96.41%
96.70%
97.22%
-0.54%
Avg SQFT
2133
2170
2114
2.65%
Med SQFT
1949
1965
1919
2.40%
Avg $ SQFT
$124
$121
$124
-2.62%
Avg DOM
61
60
51
17.65%
Median DOM
36
39
31
25.81%
# Expired
522
522
367
42.23%
# Withdrawn
687
875
568
54.05%
Not Sold
1209
1397
935
49.41%
Not Sold %
37%
42%
27%
56.43%
On the Market (houses) as of July 21, 2008:
12,756 = Active Res Listings in Austin MLS (12,466 last month)
10,620 = Total Single Family Homes listed (10,335 last month)
1853 = Condo/Townhome/Loft/Garden Homes listed (1870 last mo.)
283 = Mobile/Manufactured Homes

Below is the year to date breakdown.

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