The chart reflects the housing inventory in the five-county Austin metro compared with the median sales price.
Austin’s housing market has had a full year of “normalization”. After years of soaring prices and diminished inventory fueled by a pandemic-era buying frenzy, home prices began falling back toward more normal levels and inventory began rising in July 2022.
A year later, what does that look like? The Austin Board of Realtors this week reported that the metro had a median sales price of $462,000 last month, down 10% from a year prior and much lower than the peak of $550,000 in April and May 2022.
Inventory, which represents how long it would take to sell all of the homes on the market if new listings stopped, also increased by a full month to 3.7 months in July.
Inventory hasn’t been this high since August 2012. Keep in mind though, the population has never been higher in Austin’s history.
The Austin Round-Rock MSA has almost reached 10,000 listings, which is just shy of 4 months of home inventory causing a more stable market.
Mortgage rates edged higher in August amid the rise in the 10-year Treasury yield. Stronger than expected economic data—including resilient consumer spending (with retail sales posting 0.7% MoM growth in July) and an upward revision to 2Q real GDP growth—have led to upheaval in the bond market. The uptick in the 10-year Treasury yield is driven by several factors, including a change in investors’ perceptions that the fed funds rate will remain higher for longer—i.e., the Federal Reserve will not cut rates in the near-term (as previously anticipated) and may in fact raise rates, a decline in investors’ fears for a recession, and an increase in the supply of Treasury securities amid growing federal budget deficits. Treasury yields (and therefore mortgage rates) will likely remain elevated over the near-term as uncertainty over the direction of the fed funds rate persists.
The effect of the recent uptick in mortgage rates has not considerably affected sales activity in the Austin MSA, but a moderation in sales will likely appear over the next few weeks as affordability constraints push more buyers out of the market for homeownership. (It is perhaps important to highlight the delay between the time it takes a buyer to obtain mortgage financing and the time to close on a home—which averages one to two months.) In conjunction with the end of the ever-popular spring and summer homebuying seasons, we generally anticipate a cooler fall with respect to listing and sales activity.
Construction is finally nearing for a 1,058-acre master-planned community west of Austin with an 18-hole golf course.
“Travis Club”, a resort style neighborhood will be located on a bend of Lake Travis between Thurman Bend Estates and the Briarcliff community.
When completed, Travis Club will have a total of 497 homes — 274 single-family lots and 223 villa units. Pricing details are expected this fall, when the initial properties hit the market.
A Wyoming-based developer is eyeing a 722-acre development in Georgetown that could bring 1,500 homes and a 15-acre resort hotel to the west side of Lake Georgetown adjacent to Santa Rita Ranch.
Lakeside Estates would help meet the needs of Georgetown’s swelling population with 1,500 homes across diverse housing types — primarily ranging from 45-foot to 80-foot lots, but also including 145 one-acre lots. The plans also include 15 acres for the hotel or resort, 4.7 acres for a private amenity center and 131 acres of open space that would include about 34 acres for a public park.
According to City Council documents, construction is projected to start in February 2025 with full buildout by 2028.
The 2023 list of residential developments in the Austin area tracks neighborhoods with the most housing starts. Information encompasses the five-county area including Travis, Williamson, Hays, Bastrop and Caldwell counties. Data tracks one year of activity during 2022.
In 2022, the top 25 listmakers had a combined total of 7,277 housing starts, compared to 8,390 starts in 2021. Twelve communities debuted on the list, as well, compared to nine the year before. In 2022, the new listmakers were developing in Bastrop (2), Leander (2); Hutto (2) Liberty Hill (1); Jarrell (1) and Austin (1).