Real Estate Market:
The 3rd Quarter is usually a quieter time in real estate. We normally see a slowdown in this part of the year as people settle into school and holidays. However the fall of 2013 has kept up the pace: Sales for September were 2,391 – almost equal to sales for June – 2,767. There was only a 13% drop in sales between June to September, compared to a normal 25-30% decline.
A hot market means that months of inventory are low. Central Austin averages 1.9 months of inventory; close in Suburban areas average 1.8 months of inventory; and outer Suburban areas average 3.9 months of inventory. You can see supply levels and median prices here:
It has been a strong year in Austin, with steady job growth fueling an increase in demand from both newcomers and local move up buyers. Demand for homes has been driven by real need – not an investor mindset, looking for quick profit. But, as predicted, strong demand and low inventory has brought price appreciation. Prices have moved up by about 8% over the past year. Now, in the fourth quarter, prices appear to have stabilized and leveled off.
The news in the third quarter was interest rates. They inched up to 4.75% in September. Since then, they have fallen to 4.375%.
These are still very good rates in a historical sense, and worth locking in. Robert Shiller, professor of economics at Yale, says, “Affordability is still good compared to any time over the last 50 years. Mortgage rates are still around 4½ percent; that’s not high. Homes are still roughly, in real terms, where they were 25 to 50 years ago.”
We have several buyers for downtown condos, and have been keeping tabs on this inventory. It has really tightened up this year:
On the Market: 61 condos in MLS
Under $500,000 – 34 condos
Between $500,000 – 1,000,000 – 19 condos
Between $1M – $3M – 8 condos
(The Austonian has some new inventory, not in MLS. Also, the Seaholm Condos are scheduled for completion in 2015, however all 280 units have been reserved.)
Sold in past 12 months: 324 (27 per month)
Under $500,000 – 1.8 months of inventory
Between $500,000 – 1,000,000 – 3.1 months of inventory
Between $1M – $3M – 4.37 months of inventory
Praxis Strategy Group studied the cities that have generated STEM (science, technology, engineering, mathematics) jobs at the fastest rate over the last 12 years. The results?
“In first place: Austin-Round Rock-San Marcos, Texas, where tech companies have expanded employment by 41% since 2001 and the number of STEM workers has risen by 17% over the same period. Looking at the near-term, 2010-13, the Austin metro area also ranks first in the nation. The keys to Austin’s success lies largely in its affordability and high quality of life, both in its small urban core and rapidly expanding suburbs.”
With interest rates and prices still affordable, it’s a great time to get into the market and be a part of Austin’s success.
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More than 30 years in Austin real estate has taught us that service is the key to success, and we look forward to serving you. A big thank-you to all of you who have sent us friends and associates who need to buy or sell houses! Keep sending!
Roselind Hejl, CRS
Matthew Hejl, Realtor
Coldwell Banker United Realtors
512-327-0385 – Direct
512-789-4563 – Cell
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