July Market Update – COVID19 Impact

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July Market Update – COVID19 Impact

I wanted to update you on the latest performance of the Austin real estate market, looking at the impact of the COVID-19 pandemic and what has happened to sales.  Before I talk about transactions, though, I think the real story right now is inventory and affordability.

Inventory overall is substantially lower than the last couple of years, and the difference is growing more extreme as we enter into the summer months.  According to MLS data, Austin listings declined in June which is not the typical trend, where usually more homes come on the market as school ends.

This appears to be driven largely by far fewer listings in the sub-750K range, suggesting that (1) fewer people with homes in that price range are putting their house on the market, and (2) more houses are appreciating into the “luxury” price point range.  Whatever the reason, there are far fewer options available in Austin for buyers looking for homes under 750K.

However, the luxury market has seen the number of listings decline only slightly, and as you’ll see later in my article, the sales numbers are stronger there as well.

In terms of transactions overall, ever since the beginning of May the numbers have been climbing back toward prior years’ performance.  The data for the week of June 21-27 is still being tallied so it will come up some more, but what has been reported so far does represent a departure from the trend of the last few weeks, and a significant decline from the same time in 2019. 

This is largely driven by the sub-750K market, which has far fewer listings than it did last year.  In June, sub-750K transactions were down 24% vs. 2019, while luxury sales (750K+) were down 14%. In fact, year-to-date, sub-750K transactions are down roughly 17% vs. 2019, while luxury market sales are down about 12%.   

Anecdotally, I have heard from another agent that tracks pending sales that the number of pending transactions is higher than the same time last year, so there is a lot of activity and a great many buyers actively looking for a home… they just have far fewer homes to chose from.

Note:  All data comes from the Austin Board of Realtors’ MLS report, reflecting activity through June 30, 2020.

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