Central Texas Market Report - February 2023
While it's too soon to truly know, we might be seeing the market bottom out.
The stats I’m providing are resale homes only in Travis and Williamson Counties. More about the stats at the end.
If you are looking to buy or sell a home in Central Texas, contact me via email or at 512-650-7300. If you prefer to read instead of watch, here are the chart and transcript.
In January, 843 resale homes closed in Travis & Williamson Counties which was down 44% from January 2022. The median price in January decreased 6% to $470,000. It also marks a 22% decline from the peak median price of $600,000 that we hit in May. But, $470,000 was the same median price as December which means for the first time in seven months, prices did not decline. Whether it is a bottom of the market or just a break in the decline is yet to be seen. In real estate, the primary way we measure home values is with the median price. But, there are other numbers worth examining. The average price of a home was essentially flat year-over-year at $599,018. However, that is down 19% from the peak in May. The average price per square foot decreased by 7% to $290, and is down 21% from the May high-level mark.
The number of available homes in January was 3,827, up 237% from last January. During January, 1,560 new listings hit the market which was down 2.3% from last year.
The average sales price to list price ratio was 96.2%. For homes that closed in January, the average days on market was 73, up from 25 last year. The January sales ranged from a low of $150,000 to a high of $5,700,000.
So is the market bottoming out? It’s too early to tell. The median price was unchanged from December so that indicates maybe the market is leveling out. But a 44% year-over-year decline in the number of homes sold, following drops of 51% and 54% the prior two months, doesn’t suggest a leveling out. On a month-over-month basis, the number of homes that sold in January was 26% below December. So while the data is certainly interesting, we need to wait a bit longer to see if we are bottoming out. On the positive side, interest rates have come down about 1% from their peak in the fall and prices have continued to come down as well. This is bringing some more buyers back into the market. It doesn’t necessarily mean they are writing contracts yet, but we are seeing some more activity. The next few weeks will likely set the tone for the spring and give us some clues as to market direction. One thing I do expect is that the number of homes offered for sale will continue to be under historical norms. Over 80% of homes in Texas with a mortgage have a rate in the 4%s or lower. In fact, many are in the 2s and 3s. That is going to stop some people from moving. Known as the ‘lock-in’ effect, many folks who don’t have a compelling reason to move will decide against moving because they don’t want to change from a 3% to 6% interest rate and the accompanying increase in monthly payment.
If you have any real estate related questions, please don’t hesitate to call or text me at 512-650-7300 or email me at [email protected]. Thanks for reading “How’s The Market in Central Texas.”
The stats I’ve cited are resale homes only in Travis and Williamson County classified as single family residential, condominium, or townhouse. This is different than the stats released by the Austin Board of Realtors which include all types of homes and also include Hays, Bastrop, and Caldwell Counties. Plus, their numbers include any new construction homes listed in the MLS.
Statistics based upon information from ACTRIS for the periods cited.