Eleven Oaks Realty is proud to present their May 2021 Austin Real Estate Price Report measuring activity in the single family home market.
Austin Median Home Price Up 47%
The biggest story this month: median home prices in Austin up …. again. I feel like a broken record saying this month after month, but lately, these price increases have been significant. Last year when we used to report price increases, we were talking 2-5% from last year. Maybe 10% in certain months. This year, we are consistently seeing increases of over 30%, and this month nearly 50%. If you were waiting last year for prices to go down, you’ve essentially just priced yourself out of the market. Will we continue to see these increases? All indicators are saying yes. Will they continue to rise as quickly as they have been? I sure hope not as that is going to drastically affect affordability. The market is white hot and we are seeing more buyers than sellers in the market. The only thing buyers can do to win is increase their offer prices. And, they aren’t afraid to do so. We are seeing fewer and fewer contingencies, virtually all offers must have a some sort of appraisal waiver and increase option and/or earnest money. The median price of an Austin home in May 2020 was $436,717 compared to $643,500 in May 2021, up 47% ($206,783) 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 real estate market is white hot and buyers are struggling to find 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. Appraisals are starting to catch up, so buyers offering appraisal waivers aren’t having to come to the table with as much money as they did in previous months. But, they are still putting more down than they otherwise would have, which means they are buying a less expensive house to make up the difference or are blowing through more of their savings than they’d planned. 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 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 50% 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, especially if you aren’t going to need to buy a house. 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.
69% Decrease in Time to Sell Home in Austin
In May 2021, it took only 8 days to sell a home in Austin, on average, compared to 27 days in May 2020, marking a 69% (18 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 5 days, which is more representative of how quickly the market is moving.
Number of Homes Taken Off the Market Saw a 51% Decrease
In May 2021, there were 91 homes taken off the market compared to 184 in May 2020. This marked a 51% (93 home) decrease in year over year numbers.
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 38% Increase
Austin saw a 38% increase in the number of homes sold comparing May 2020 to May 2021. In May 2021, we saw 1,130 homes sell in Austin compared to 818 in May 2020 marking a 38% (312 home) increase in year over year numbers. We are seeing more sellers decide to sell their homes, but it’s still not meeting the demand as inventory is still below 1 month.
69% Decrease in Austin Housing Inventory
In May 2021, we saw 0.5 months of inventory on the market, compared to 1.6 months of inventory in May 2020, showing a 69% (1.1 month) decrease in year over year numbers. With inventory levels at 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). With so little inventory, buyers are forced to be less picky and expand their search parameters.
Austin Homes Under Contract Saw a 3% Increase
In May 2021, 1,244 homes went pending (under contract) in Austin compared to 1,212 in May 2020, marking a 3% (32 home) increase in year over year numbers. This small increase is due to a supply shortage, not a demand limitation.
41% Decrease in Number of Homes on the Market
In May 2021, we had 1,938 homes for sale in Austin, compared to 3,310 in May 2020, showing a 41% (1,372 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.
2% Decrease in Number of Homes Listed for Sale
In May 2021, we saw 1,321 homes introduced to the market compared to 1,343 in May 2020, marking a 2% (22 home) decrease in year over year numbers. With prices increasing as fast as they are, sellers are worried they won’t be able to find something else if they sell their homes now. They are deciding to stay put and make do with what they have versus selling and trying to find something else.
Supply Down 41% and Demand Up 38%
This month we saw a 41% decrease in supply (number of properties for sale) and a 38% increase in demand (number of sold properties). As demand increases without an increase in supply, we will continue to see more and more inventory shortages.
Median for Sale Up 17% vs Median Sold Price Up 47%
This chart compares the Median for Sale Price vs the Median Sold Price to show their relationship. In Austin, we saw a 17% increase in the median for sale price and a 47% increase in the median sold price of single family homes in year over year numbers.
Source: Clarus Market Metrics, ACTRIS Sold Data
May 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 May 2021 Austin home sales below. The most expensive home that sold in May 2021 sold for $10,475,000 and the least expensive home sold for $210,000. Homes ranged in size from 540 sqft – 12,555 sqft with an average size of 2,286 sqft. The average price per square foot for a home that sold in Austin in May 2021 was $365.06 with the lowest being $119.65/sqft and the highest being $1,333.33/sqft. It took, on average, 9 days to sell a home in Austin and sellers received, on average, 113.15% 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||May 2021|
|Property Type||Single Family Homes||Number Sold||1,130|
|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 just about 2 weeks, which indicates an extreme sellers market. Demand is up 38% and supply is down 41% and there is very little new inventory coming online from builders. 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. In fact, even homes that are in poor shape are getting far above list price in a lot of cases. Homes taken off the market are down 51% which is causing record low inventory. Though new listings are down 2%, it isn’t enough to keep up with significant increases in demand. 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 9 days, which is less than half the time it took last year. Median time to sell is 5 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 not as affected as it would have been in year’s past. Though we are seeing multiple offers, overbids and lines to get into properties, payments are not what they would have been had interest rates remained in the 4 and 5%’s. 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.