The Austin housing market is soaring. With demand up and few houses to choose from, the Austin home prices are soaring and the buyers have to bear the brunt. The Austin real estate market has been unscathed by the pandemic throughout with the real estate industry pumping billions of dollars into this region’s economy. Austin home prices are predicted to continue their upward climb in 2021.
Total home sales in 2020 were higher than in 2019 despite a dip in the early spring season due to the pandemic. A record-breaking 40,165 homes were sold. $17,579,802,503 in sales volume were sold across the Austin area last year. Sales dollar volume is a key indicator of sales activity and prices.
The five-county Austin-Round Rock MSA, including Travis, Williamson, Hays, Bastrop, and Caldwell, broke all the records in 2020 as housing demand across the region reached unprecedented levels. In 2020, the median sales price in the Austin-Round Rock MSA rose 9.2% to $344,000. The new listings decreased 0.4% while active listings declined 34.2%.
However, pending sales jumped 13.1% and are now outpacing new listings, indicating that homes are selling faster than new ones can hit the market. Homes across the Austin MSA are selling 25 days fewer than a year ago. Home prices are surging in double-digits and will continue to rise in 2021.
Looking at this trend, the Austin area needs more housing supply at all price points in order to stabilize home price growth in 2021. Currently, the months of supply is just 0.6 months, which means at the current pace of sales it would take only 5 weeks for the supply to dwindle to zero.
According to Realtor.com, the median list price of homes in the city of Austin was $475K in January 2021, trending up 14.1% year-over-year. The median listing price per square foot was $274. New listings have been increasing in the city and it now has a higher inventory than surrounding markets like Williamson County.
Current Trends in The Austin Housing Market
Austin’s housing market was impacted by the pandemic which led to a decline in home sales due to critically low levels of housing inventory. As sellers backed out amid growing uncertainly and health crises, the Greater Austin area also felt the stark effects of this crisis. More and buyers are moving to Austin’s suburbs to adapt to a new work from home culture.
Companies like Google and Tesla are moving operations to Austin. The software giant Oracle has also relocated its headquarter here. As more companies move here, that means more people looking for homes, and the city is also attractive to outside investors. With a steady influx of job creation in the pipeline, the housing market will continue to post strong numbers well into 2021.
Big companies moving here will also play into what happens to the housing market. With historically low mortgage interest rates (below 3%) and an all-time high in corporate relocations, the housing demand is way up and the supply side cannot match up.