Austin Housing Market Report October 2024

Staying informed about the Austin housing market is crucial whether you're looking to buy or sell. With fluctuating mortgage rates, changing inventory levels, and shifting buyer demand, making informed decisions is essential in this dynamic environment. In this blog, we'll dive into the latest trends, analyze key indicators, and discuss what these changes mean for you.

The Austin-Round Rock-San Marcos housing market highlighted stability and seasonal changes in October. Median home prices dipped 3% year-over-year to $430,000, while pending sales rose 13%, reflecting continued buyer interest despite cooler fall activity. With 5.1 months of inventory and over 11,000 homes on the market, opportunities abound for home buyers and sellers. Here’s a closer look at the latest trends from October and what they mean for you:

• Homes Actively for Sale Rise—The number of homes for sale is up 9% yearly, providing buyers with more options; however, it decreased by 4% month over month, reflecting a slight seasonal or market slowdown.
• Home Prices Steady—Median home prices are $430K, down 3% year-over-year but up 1% from last month, hinting at steadying demand in the market.
• Time on Market Increases – Average days on market rise to 70, up 7 days year over year. Realty Austin Compass listings outperform, selling in 63 days—7 days faster than the area average.
• Buyer Demand Increases—Pending sales rose 13% yearly, showing stronger buyer interest, but dipped 8% monthly, reflecting seasonal cooling.
• Home Sales Decline—Sales dropped 1.5% year over year and 1.6% month over month, signaling a modest cooling in buyer activity.
• Housing Supply Steady – Supply stands at 5.1 months, a slight 0.5-month increase from last year, signaling a steady market with balanced conditions continuing.
• Market Snapshot – Over 11,000 homes are on the market, selling for an average of 92% of their original list price. Realty Austin Compass listings excel, achieving 97% of their original list price.

What Buyers Should Know About More Housing Options
Austin’s inventory has grown 9% year-over-year, giving buyers more choices and less competition. This allows more time to find the perfect home and potentially negotiate favorable terms. The Federal Housing Finance Agency notes that slower price growth has slightly improved affordability, offering buyers hope to balance rising costs and interest rates. “With more homes on the market, it’s a great time for buyers to explore their options, but working with a local agent remains essential,” says Amanda Dudley, Agent Success Manager at Realty Austin Compass.

How Sellers Can Stand Out with Creative Financing
Affordability concerns among buyers have sellers turning to innovative solutions like MORE Seller Financing. This program allows sellers to offer rates up to 2% below market averages, attracting more interest while facilitating faster closings. “MORE Seller Financing bridges the gap between affordability challenges and seller goals, creating a win-win scenario,” says Dudley. “Offering unique incentives like this can help sellers secure motivated buyers in a competitive market.”

Mortgage Rates Shape the Market for Buyers and Sellers
Mortgage rates hovering in the 6-7% range continue influencing buyer activity and affordability. While some buyers hold out for lower rates, experts warn that waiting may mean missing out on favorable opportunities.“Rates in the low-to-mid 6% range may persist into 2025, meaning buyers waiting for dramatic drops could be waiting indefinitely. Sellers must adopt competitive pricing to attract buyers grappling with affordability challenges,” advises Clare Knapp, Ph.D., housing economist for Unlock MLS.

Equity Gains Benefit Sellers and Buyers Alike
Austin homeowners benefit from significant equity gains, part of a national trend of rising homeowner wealth. Nearly half of U.S. mortgaged properties are now considered equity-rich, which gives sellers greater negotiating power. “Homeowners can leverage their equity to upgrade or reinvest while attracting buyers who recognize the value in Austin’s stable market,” explains Jennifer Korba, Senior Agent Success Manager at Realty Austin Compass. “Buyers also benefit from competitive lending options created by the surge in equity-rich homeowners.”

Why Pricing Strategically Is Key for Sellers
Though Austin’s median home prices have dipped 3% year-over-year, sellers who price competitively and leverage pre-market exposure are seeing solid results. Homes in Austin are selling for an average of 92% of their original list price. When marketed effectively, homes can sell for an average of 97% of their list price, like the average for Realty Austin Compass listings. “Pricing your home at market value not only attracts more buyers but also increases the likelihood of multiple offers,” says Tom Thornton, Agent Success Manager at Realty Austin Compass. “Sellers should work closely with agents to determine the best price strategy to maximize results.”

Opportunities in New Construction for Buyers
New construction remains a bright spot for Austin buyers, with builders offering incentives like rate buy-downs and closing cost assistance to move inventory. These homes appeal to first-time buyers and those looking for more affordable options. “New builds offer unique advantages for buyers seeking move-in-ready homes and competitive terms,” says John Coake, Vice President of Sales at Realty Austin Compass. “Popular areas like Buda and Kyle are seeing increased demand, making them ideal for buyers settling in the Austin area.”

Migration Patterns Keep Austin Thriving
Austin remains a top destination for new residents, driven by its strong job market, thriving tech industry, and appealing lifestyle. High in-migration from states like California and New York continues to fuel housing demand, often driving up competition and influencing property values. This influx benefits sellers who can position their homes to appeal to out-of-state buyers, while buyers should prepare for increased competition in popular areas. Meanwhile, out-migration to states like Florida and Colorado highlights evolving lifestyle preferences, such as climate or tax benefits, shaping local market trends. Understanding these patterns helps buyers, sellers, and investors make informed decisions in a dynamic market.

Your Moves Inspire
At Realty Austin Compass, your moves inspire us to guide you through your real estate journey. Our agents help you navigate market trends, decode pricing dynamics, review contracts, and leverage negotiation skills to secure the best outcome for you. Connect with one of our local agents today to confidently navigate your next move.

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