January real estate stats for the Austin Metro are in! Here's what you need to know.
Hello and we hope you’re doing well! We can’t believe we’re already almost through February, but the weather has been wonderful and it’s looking like it will be an exciting year.
We ran statistics for January, which are available below. Average and median sold prices inched up slightly along with months of housing inventory. Year Over Year (YOY) Change for properties under contract has consistently improved over the past few months and YOY change for units sold has now followed suit. We believe that we’re in the early stages of a market recovery, and we should see rates gradually come down through the year.
Key Highlights:
Average sold price declined -3.5% YOY in the Austin Metro and -6.8% in the city.
Total sales (estimated) increased YOY +7.8% in the Austin Metro and +3.9% in the city.
Average days to sell a property are now 80 in the Austin Metro and 75 in the city.
There are 4 months of inventory in the Austin Metro and 4.4 in the city.
Pricing Finds Bottom
Average sold price declined -3.5% in the Austin Metro and the median declined -2.2% YOY. This is relatively flat pricing that indicates pricing has bottomed (or near it). We think that, in retrospect, 2023 will be the lowest buyer demand of the cycle. Experts predict the Fed will begin lowering interest rates in May 2024 and mortgage rates will track with the Fed rate (and may decline a bit earlier).
It's Still Early in the Season
It’s important to remember that we’re early in the year, and January is typically a slow month for both contracts and sales. Because of this, we shouldn’t read too much into these numbers, although nothing here is dramatic. We will get a clearer picture of the 2024 market in the coming months.
Normal Seasonal Demand
While 2023 was very sluggish, buyer and seller behavior returned to normal seasonal trends. We expect 2024 to also bring normal behavior. We will likely see contracted units ramp up in March and April with the number of sold units peaking in May and June.
Contracted & Sold Units Improve YOY
Average and median prices generally lag behind contracted and sold units. We have seen YOY contracted units improve for more than 6 months now. It’s encouraging to see YOY closed units improve at the rate they have after ups and downs over the past 6 months. The YOY change is relatively modest, and we expect similar modest price changes in the spring.
Stubborn Jobs Data
We have reasonable assurances that mortgage rates will improve in 2024, which will help the market recovery, but jobs data remains stubborn. The tech sector appears to continue its hiring freeze. We’re hopeful this will thaw in 2024, which will add more demand on top of the already increasing demand that is due to interest rates.
If You're a Buyer:
Not much has changed at a high level, but you can expect more competition in the spring. You can expect more attractive rates in a few months, but you will likely pay a slightly higher price. We believe that 2023 was a strong buying opportunity, and we believe that 2024 will be viewed as a buying opportunity in retrospect. It’s a great time for you to jump into the Austin market.
If You're a Seller:
Seasonality is on your side, and we’re entering the most attractive time of the year for sellers to prepare and sell their properties. We’ve already seen more demand than over the holidays, which is no surprise but is still comforting. If you need to sell this year (or you’d like to sell), the spring and early summer months are the best time to do so.
Our goal as your trusted real estate advisors is to provide you with the information you need to help you reach your investment goals.
As always, real estate is hyperlocal and extremely situational, so please reach out to us to discuss your specific situation. We’d love to help you and strategize what’s in your best interest.
Cheers!
