Since a lot of people are wondering about the amount of activity in the Austin real estate market, I am going to start periodically posting an update on the amount of inventory in the Austin area. The Austin Board of Realtors provides an update each month, looking back at the prior month, but I wanted to provide something more up to date as well as with a little more granularity by showing inventory at various price ranges.
Be sure to read the explanation in the image below re: the areas I am looking at and how I define “Central Austin” and “Greater Austin”.
As you can see, we have come a long way in a relatively short period of time, far from our sub-1 month of inventory at the beginning of the year. And the luxury market, as one moves further up the spectrum in multi-million dollar price points, shows a significant surplus.
Clearly the $5M+ price range is the most extreme, with over 2 years of inventory in what I define as Central Austin (which includes close-in Westlake), and over 3 years in Greater Austin.
The traditional metric for a balanced market is 6 months. Below 6 months of inventory is considered a seller’s market, and above 6 months is considered a buyer’s market. So you can see that once you get to $2.5M or higher, we appear to be in a strong buyer’s market.
And keep in mind these numbers are volatile. For example, in a price range in which there has only been one sale in the prior 30 days, if another one happens within the 30 day window it will cut the months of inventory in half (assuming active listings stay the same). But we are entering what is typically a slower time of year, particularly once we get into the holiday period from Thanksgiving to New Year’s.
At the same time, this is when some sellers choose to withdraw their home from MLS, so I expect that inventory will gradually decline over the next few weeks.
What does all this mean for the luxury home buyer?
There are more choices out there, and fewer buyers chasing them. That suggests there may be more flexibility from sellers on terms.
What does all this mean for the luxury home seller?
There is a lot of competition. It is absolutely critical that your house stand out in order to entice buyers. Homes need to be in tip-top condition. I never recommend trying to guess a buyer’s tastes and remodel your house based on assumptions of what will appeal. The best approach is to shift to neutral colors and make sure that the house looks well-cared for.
Trying to make sense of the market? Let me help!
- Set up a search with Moreland’s Home Search Powered by RealScout and see all active MLS listings, plus Moreland private listings, in one place.
- Contact me for more information and market analysis, and how to best go about buying or selling a home (or both) in this market!
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