Let’s get into it and talk about the most recent sales statistics for the Austin real estate housing market. In May there were 4,033 sales which is up 40.5% from last year. This is a misleading statistic. Of course, we know last year many sellers held off putting their homes on the market and so the number of sales from last year was artificially low. If you look at the last two years the sales in May were essentially flat from May, 2019.
The pending number of sales was down 33.8% from 4,370 in 2020 to only 2,895 homes under contract in May, 2021. That will probably mean when we get the final statistics for June sales those numbers will be well below last year and many of the headlines will talk about how the sales market is dropping, indicating less demand. Because we are out in the market every day we know that isn’t the case and any softness in the number of homes sold is due to less homes to buy.
This is something important for potential sellers to understand. Many sellers are holding off until they know where they are going. Once their plans are solid, they will be ready to sell. If that’s you, what you must understand is once things start opening up like that you will also be selling in a market with a larger number of homes competing against your home.
I have seen estimates that the US housing market is short 5.5 million homes. On a macro level that may be correct. However, in our market where buyers are emotional and paying higher prices out of fear all it takes for the sales price of your home to drop from $880,000 to $800,000 isn’t 5.5 million homes, all it may take is another home or two being listed in your neighborhood at the same time.
The average sold price was up a whopping 43.1% to $582,324 and the median sold price was up 41.5% to $460,000. The median price is a better reflection of how the overall market has shifted up $135,000.
Median dollars per square foot was up 43.1% to $233. This is important to remember that doesn’t mean your home is worth the square foot measurement times $233. It could be less or it could be much more.
The median home sold for 7% OVER list price. That’s an interesting statistic but it may not apply to your situation and here’s why. I follow sales in many neighborhoods. In one neighborhood there were two homes that sold for $500,000 and $535,000. A new listing came on the market with the exact same floor plan for $425,000 and sold for $515,000. The home sold for 21% over list price but that doesn’t really mean anything. If that agent listed the house for $500,000 and sold it for $600,000 it would be significant. Listing a home for $90,000 below market value and then bragging about getting 20 offers doesn’t mean anything. You’re just wasting the time of all those buyers and agents thinking they could buy a $515,000 home for 425,000 and likely selling your home for less than you could if you had a better strategy.
There may be a benefit of pricing a little lower to get a “snowball effect” but there’s no reason to list $90,000 too low anymore. If you are planning to sell you want to have a listing agent who has their feet on the ground in your market to know what homes are selling for. In many cases what I think is happening is a seller hires an agent without much experience. You have to remember the average agent only sells 2-3 homes per year. That agent recommends a price for your home 6 weeks before you are on the market and then they don’t circle back with you to discuss changes in the market causing you to sell too low.
Finally, the median days on the market is down to 5 from 17 just a year ago. This is the time from when a home is on the market until it goes under contract. Typically, it takes another 30-45 days before closing financing is involved.
You can call me at 512-791-7473 if you have questions about the real estate market or you want our help buying or selling in the area.