Signs emerge that the housing market is stabilizing. Learn what is creating momentum for buyers and sellers and what to expect in the coming months in the Austin market spring 2023.
To succeed in today’s market, it’s crucial to adopt fresh tactics and strategies. Partnering with experienced agents and staying up-to-date with the latest market trends in your area can help you make informed decisions that set you up for a successful future.
The Austin housing market is stabilizing, creating momentum for buyers and sellers as both new and active listings increased, and homes under contract rose by 23% from last month. In this blog, we’ll take a closer look at the latest data and market trends to provide insights on what to expect in the coming months.
So, what happened in the Austin market spring 2023? Let’s take a closer look:
- The number of homes for sale increased by 377% year over year, bringing more choices and opportunities to homebuyers.
- The average days on the market decreased from last month to 80 days but is up by 58 days, compared to a year ago.
- The number of new listings entering the market increased by 6%, compared to a year ago, indicating rising seller confidence.
- The number of homes under contract fell by 7%, compared to a year ago, but increased by 23% from last month as buyer demand gained momentum this spring.
- The number of homes sold fell 14%, compared to a year ago, but closed sales have increased by 71% since January 2023.
- Monthly inventory levels are at 3.0 months, compared to 0.5 months in March 2022.
- Median home sale prices decreased by 13% year over year to $450K but made a comeback from last month’s $436K.
Over 8,000 homes are for sale and over 3,000 homes have reduced their price in the past 30 days. Having an experienced agent to price your home correctly is more important now than ever.
| Source: Austin Board of REALTORS®, Austin-Round Rock Metropolitan Statistical Area. |
Rising seller confidence and buyer demand heat up as spring approaches
The number of new listings entering the market increased by 6% compared to the same month last year, and have been making a major comeback since January, increasing by 58% from the previous month. This indicates rising seller confidence, and as the weather warms up, more sellers are getting ready to put their homes on the market before summer. The number of homes under contract also saw a 23% increase from the previous month, as buyer demand gains momentum this spring.
“Pending home sales have been growing since January. We are seeing signs that the housing market slowdown is coming to an end,” said Jennifer Korba, Central Agent Success Manager, Realty Austin.
In line with this, the Mortgage Bankers Association reported demand for purchase loans moved up for the fourth week in a row, as mortgage rates continued to slide back from their 2023 highs. Buyer demand is also growing as home prices have eased from their pandemic peak.
| Source: Austin Board of REALTORS®, Austin-Round Rock Metropolitan Statistical Area. |
Home prices stabilize after a year of fluctuations
While median home sale prices decreased by 13% year over year to $450K, they increased by 3% from the previous month, indicating a balance in the market. Year over year, home prices have declined significantly since their peak of $550K in May of 2022. However, the month-over-month pricing is a leading indicator of a changing market.
“We are likely to see increased seasonal demand in the coming months, but the stabilization of home prices is a positive sign for the market,” said Tom Thornton, Southwest Agent Success Manager, Realty Austin.
| Source: Austin Board of REALTORS®, Austin-Round Rock Metropolitan Statistical Area. |
Increased inventory provides more options for homebuyers
The Austin market spring 2023 saw a 377% increase in the number of homes for sale in March 2023 compared to the same month last year. While the inventory slightly decreased from the previous month, it is still a significant increase from last year’s low supply. With over 8,000 homes for sale, homebuyers now have more options to choose from than they have had in recent years.
“This time of the year is typically when housing inventory starts climbing. We are seeing a rebound in housing market conditions. We expect to see an increase in pending home sales in the coming weeks,” said Amanda Dudley, North Agent Success Manager.
| Source: Austin Board of REALTORS®, Austin-Round Rock Metropolitan Statistical Area. |
Positive economic outlook fuels momentum in Austin’s housing market
According to the 2023 Texas State of the Economy Report, the outlook for the Texas economy outperforms the national forecast. This positive economic outlook, based on expected revenue growth, strong hiring and talent retention, is reflected in the Austin housing market. The leisure and hospitality sector is projected to lead job growth in Travis County, contributing to the momentum of Austin’s housing market. Even as the pace of home sales and price growth adjusts from the extreme anomaly of the last two years, Austin’s housing market is still demand-driven, contributing over $1.5 billion to the region’s economy last month.
Mortgage rates impact homebuyers’ budgets and affordability
The 30-year fixed mortgage rate has been bouncing between 6-7% this year, impacting home buyers’ monthly payments and ability to qualify. However, mortgage rates have been declining, creating increased optimism among prospective homebuyers as the housing market heads into the peak season of spring and summer. It’s important for homebuyers to explore all of their mortgage options and understand what impacts mortgage rates and buying power to plan their home buying budget accordingly. In addition, affordable housing resources and overcoming the down payment hurdle for homebuyers will be key to achieving homeownership.
Affordability and accessibility remain top of mind for the region. Ashley Jackson, REALTOR® at Realty Austin and 2023 Austin Board of REALTORS® president said, “Working class families have long been priced out of the market in the urban core due to affordability issues. Urgent action is needed to ensure that Austin’s rising housing supply is leading to all types of housing, at all price points, in all areas of Austin.”
If you’re looking to buy or sell in today’s real estate market, don’t go at it alone. Partner with a trusted real estate expert who can guide you every step of the way and help you achieve your goals. Contact a local real estate professional today to learn more!
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