Eleven Oaks Realty is proud to present their March 2021 Austin Real Estate Price Report measuring activity in the single family home market.
Austin Median Home Price Up 33%
The biggest story this month: median home prices in Austin up …. again. And this time, even more significantly. Last year, we used to see 2-5% increases, 10% on big months. People were saying then that they were going to wait until prices stopped rising. Now we consistently see prices up 30%+. So, it doesn’t look like it slowed down one bit. In fact, it picked up speed as we are now seeing houses sell within hours, appraisal waivers, no contingencies and thirty or more percent above asking price. And, with home buyers migrating from other areas with no supply to put back in the market, we are in an extreme inventory shortage. The median price of an Austin home in March 2020 was $439,500 compared to $585,000 in March 2021, up 33% ($146,000) in year over year numbers.
Median home price helps us see the distribution of homes sold and does not really give us an indication of the increase or decrease in a particular home’s market value. To analyze market value, we’d have to take an in depth look at a neighborhood. If you’re looking for something like that, please check out our Austin Home Values Report.
What does this mean to buyers? The Austin market is white hot and buyers are having a hard time finding a house. With the influx of people from out of state who have no house to sell to replenish supply, inventory levels are at an all time low. There are way more buyers in the market than there are sellers and the only thing left for buyers to do to be successful is offer more money. But, because comps aren’t quite there yet, buyers are having to make up the difference from a low appraisal and contract price in cash. Thus, they are putting more down than they otherwise would be. Buyers who don’t have the cash to make up the difference on a low appraisal are struggling to find a seller that will take their offer. If you’re thinking of buying, find an agent who knows the market and can help you be successful, but also smart, in a market like this. Interest rates are still low, which is helping affordability. Hopefully we will see a bit of a slow down in the frenzy as spring hits and we see more inventory. But, I don’t see prices going down any time soon.
What does this mean to sellers? With inventory at less than 1/2 month, we are in an extreme seller’s market. Buyers are offering appraisal waivers, high option fees and earnest money, minimal contingencies and sometimes 40% above list price (or more). It is not uncommon to have 75 offers on a house. Sellers can basically have their pick of several very enticing offers. If you have a house to sell, you might consider doing it now while buyers are motivated and ready to open up their checkbooks. If interest rates rise or we see a drop off in demand, we might lose some of the edge a seller has. If you have to find another house, be prepared to be in temporary housing as you might not get the first home you make an offer on.
40% Decrease in Time to Sell Home in Austin
In March 2021, it took only 10 days to sell a home in Austin, on average, compared to 17 days in March 2020, marking a 40% (7 day) decrease in year over year numbers. And, the best homes are selling even faster, so buyers really have no time to think about making an offer. The median time to sell a home in Austin was only 4 days, which is more representative of how quickly the market is moving.
Number of Homes Taken Off the Market Saw a 53% Decrease
In March 2021, there were 85 homes taken off the market compared to 182 in March 2020. This marked a 53% (97 home) decrease in year over year numbers. And, 85 even seems high for homes taken off the market. All of the homes my clients have looked at have gone pending in a matter of days, sometimes hours.
If you need to sell and your home was priced right, maybe there was something else going on. The biggest culprits we see are incorrect info in the MLS and poor marketing. Check out our Austin Home Marketing Plan to see how your homes would be marketed.
Having trouble selling your home? Check out our Austin Home Not Selling resources page to find out why.
Number of Sold Homes in Austin Saw a 5% Decrease
Austin saw a 5% decrease in the number of homes sold comparing March 2020 to March 2021. In March 2021, we saw 924 homes sell in Austin compared to 977 in March 2020 marking a 5% (53 home) decrease in year over year numbers. What we have is an inventory shortage, not a demand shortage. Sellers who want to stay in the area are questioning whether or not they’ll be able to compete in the buying market. Sure, they could sell their home and make a mint, but they might not be able to find a home. So, they are staying put. If there were more listings, we’d most certainly see more sales.
87% Decrease in Austin Housing Inventory
In March 2021, we saw 0.3 months of inventory on the market, compared to 2.0 months of inventory in March 2020, showing an 87% (1.7 month) decrease in year over year numbers. With inventory levels at less than 1/2 month, we are in the most extreme seller’s market territory. I have not seen inventory lower since I have been monitoring the market (11 years). Buyers can no longer be picky on exactly what neighborhood they want to live if they have a timeline they need to meet. They have to expand their search in hopes they will be able to find something.
Austin Homes Under Contract Saw a 42% Increase
In March 2021, 1,299 homes went pending (under contract) in Austin compared to 914 in March 2020, marking a 42% (385 home) increase in year over year numbers. Again, we would have seen more under contract if we had more supply. The only thing that’s holding back sales is not enough inventory in the market to meet current demand.
41% Decrease in Number of Homes on the Market
In March 2021, we had 1,736 homes for sale in Austin, compared to 2,939 in March 2020, showing a 41% (1,203 home) decrease in year over year numbers. We are seeing fewer sellers list their homes for sale. Combine that with out of state buyers moving to Austin and it’s no wonder we have extreme inventory shortages.
6% Decrease in Number of Homes Listed for Sale
In March 2021, we saw 1,333 homes introduced to the market compared to 1,422 in March 2020, marking a 6% (89 home) decrease in year over year numbers. Though we are seeing more listings than we’ve seen since last summer, it still isn’t enough to keep up with demand. It will be interesting to see if sellers continue to feel confident about their ability to find something to move to when they sell their homes or if they will be scared into staying put.
Supply Down 41% and Demand Down 5%
This month we saw a 41% decrease in supply (number of properties for sale) and a 5% decrease in demand (number of sold properties). Though it seems we have a decrease in demand, this is really misleading. With more inventory, we would have had way more sales and thus, more demand. But, since we are inventory starved, we have a lot of pent up demand that doesn’t show in this data.
Median for Sale Up 15% vs Median Sold Price Up 33%
This chart compares the Median for Sale Price vs the Median Sold Price to show their relationship. In Austin, we saw a 15% increase in the median for sale price and a 33% increase in the median sold price of single family homes in year over year numbers.
Source: Clarus Market Metrics, ACTRIS Sold Data
March 2021 Austin Real Estate Price Report – Strictly Numbers
For those of you who prefer to see the actual numbers, we’ve included the figures for March 2021 Austin home sales below. The most expensive home that sold in March 2021 sold for $7,400,000 and the least expensive home sold for $194,000. Homes ranged in size from 440 sqft – 13,630 sqft with an average size of 2,281 sqft. The average price per square foot for a home that sold in Austin in March 2021 was $352.16 with the lowest being $107/sqft and the highest being $1,983.17/sqft. It took, on average, 17 days to sell a home in Austin and sellers received, on average, 110.43% of their original list prices.
|Beds||Baths||SqFt||List Price||LP/SqFt||Sold Price||SP/SqFt||SP/LP||SP/OLP||ADOM|
|Status||Sold||Sold Date||March 2021|
|Property Type||Single Family Homes||Number Sold||925|
|Source:||ABoR Sales Data||Area||Austin|
Time to Buy? Sell?
As we always say, the best time to buy or sell a home is when you need to buy or sell. If you have a house to buy, buying when its a sellers market may hurt you on the buying end, but you’ll make it up on the selling end. If you’re trying to get into the market for the first time, the only way you’ll know that we’ve “hit bottom” is when its in the rear view mirror. Work with professionals who can help you analyze your financial and lifestyle to determine if now is the right time to buy or sell.
Looking strictly at the numbers, it appears the recommendation for this month is – it’s time to sell. Inventory is at at less than 2 weeks, which indicates an extreme sellers market. Though demand is down 5%, it’s only because there is not enough inventory as supply is down 41%. Buyers are feeling the pinch, big time. There is fierce competition on nearly every single home listed, no matter where it is and what condition it is in. Homes taken off the market are down 53% and new listings are down 6% which is causing record low inventory. With inventory levels so low and the number of buyers up significantly, we have seen prices increase significantly. If we don’t see more supply, I would expect us to see an even greater increase in prices. Motivated buyers are in the market, snatching up inventory, on average, in 10 days, which is less than half the time it took last year. Median time to sell is 4 days, which is more representative on how much time buyers usually have to make a decision. Often times much less. Sellers who are looking to sell should get their homes on the market soon. Anxious buyers who have been waiting out the crisis are itching to find something. Plus, new buyers who are taking advantage of historically low interest rates to make a change in their current housing situation.
If you’re a seller who needs to sell now, work with a professional Realtor who can help you position your home as the best value on the market. Check out our 88 Ways to Sell Your Home Faster and For More Money for some tips on how you can prepare your home to meet the market. For more info about our Home Selling Program and why it is the best in Austin, check out Sell My Austin Home.
If you’re looking to buy, keep in mind interested rates are still low, so affordability is better than it has been despite rising prices. Though we are seeing multiple offers, overbids and lines to get into properties, payments are still lower than they were a few years ago. The start of the year is resembling the peak of one of the hottest spring markets, so you’ll have to be proactive with your search. Buyers who act quickly will have a jump on others who are taking their time. If you set alerts, check out new listings as soon as they’re listed and are prepared to make offers, you’ll beat other buyers to the best homes. And, if you’re ready to act, you can make an offer before the competition has time to see it. The best homes are still selling quickly, especially since there are fewer overall choices. You’ll want to give yourself ample time to make a decision. Get your search set up and start looking at new listings now. If you’re looking to buy, we can help you be successful. We know the market and know how to get the best deal for a buyer. For more info about buying a home, visit Buy a Home in Austin.
Questions About the Austin Real Estate Price Report?
Do you have questions about this Austin Real Estate Price Report? Call us at (512) 827-8323 or email us at info@11OaksRealty.com and we’ll help you in any way we can. If you’re looking to buy or sell Austin real estate, don’t forget to check out our Buyer Resources and our Seller Resources for more tips.
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