Austin, Texas, April 2024 Housing Report and Market Trends

Realty Austin | Compass just published their April 2024 Housing Report based upon data and insights form the Austin Board of Realtors. Here is the report from RA Compass along with some further insights from me.

In April, the Austin housing market saw a 5.9% year-over-year increase in home sales, alongside a modest 1% uptick in the median home price, now at $469K. Insights from the Austin Board of REALTORS® suggest a prevailing atmosphere of confidence and optimism among buyers and sellers alike.

Let's take a closer look at the latest trends and what they mean for you:

Home price gains — Median home prices increased by 4% from last month and showed a slight 1% increase compared to last year.
Time on the market decreases — Homes are now on the market for an average of 68 days, down 12 days from last month and 4 days from last year.
New listings surge — The number of new homes hitting the market increased by 8% from last month and 26% compared to last year, providing buyers with more options in today’s market.
Increased buyer demand — Pending sales increased by 2% compared to last year and 1% from last month.
Rise in home sales — Home sales increased by 5% compared to last year and by 5% from last month.
Housing supply and inventory — Housing supply stands at 4.3 months, up from 3.2 months last April.Current market snapshot — Over 10,000 homes are for sale, selling for 95% of their original listing price.

Understanding Home Price Trends

According to recent data from Fannie Mae, almost 1 in 4 people think home prices will come down. However, recent data paints a different picture: home prices have risen since the beginning of the year, with minor dips during seasonal lulls. These fluctuations should be balanced with the overall trend of sustained price growth.

“Since January 2024, home prices in Austin have increased by 9%. Waiting for declining home prices or mortgage rates could cost buyers more in the long run. It's important for potential buyers to stay informed and make decisions based on the broader market trends rather than short-term changes,” said Tom Thornton, Agent Success Manager at Realty Austin Compass.

Mortgage Rates Back Under 7% After Inflation Data

Mortgage rates dropped back under 7% after recent inflation data was released. The Consumer Price Index (CPI) showed core inflation at 0.3% for the month and 3.6% for the year, which, while still higher than the Federal Reserve's target, relieved bond traders and led to lower rates. Additionally, weaker retail sales data helped ease inflation concerns. This means slightly lower mortgage rates for potential home buyers, making loans more affordable. For sellers, the lower rates could attract more buyers, although overall affordability remains a challenge.

"The increase in sales across our region shows more chances for buyers in the market. Coupled with mortgage rates declining for the second week, there's more affordable inventory, making it easier for first-time buyers to become homeowners. Mortgage rates are expected to drop gradually, giving buyers more purchasing power as the year progresses," said Amanda Dudley, Agent Success Manager at Realty Austin Compass.

Housing Inventory Reaches 8-Year High

As mortgage rates fall, the Austin housing market hit a significant milestone, reaching an 8-year high with 4.3 months of inventory and over 10,000 homes for sale. The increased housing supply means home buyers have more choices and potentially less competition. With more homes on the market, buyers might find it easier to search for properties that meet their needs and budget.

The Sun is Shining on Sellers This Summer

Sellers feel confident, especially during late spring and early summer, known as the prime selling season. According to the latest Home Purchase Sentiment Index from Fannie Mae, the percentage of respondents who say it’s a good time to sell is on the rise.

“With many buyers looking to transition during summer, sellers can expect the usual seasonal increase in market activity. That said, competition for buyer's eyes is intense with our recent increase in inventory. Make a plan with your agent for expert guidance and assistance to prepare your home for a summer listing and capitalize on this favorable market,” said Jennifer Korba, Agent Success Manager at Realty Austin Compass. “Selling now offers the best of both worlds: taking advantage of growing inventory for your move while ensuring your home remains a standout in the market.”

Why Buying a Home Makes Financial Sense

There are compelling reasons to buy rather than rent for your financial future. According to Federal Reserve data, home values generally appreciate over time, as evidenced by a consistent upward price trend over the past 60 years. On the other hand, rent tends to increase steadily over time, making homeownership with a fixed-rate mortgage a more stable and financially rewarding option in the long run.

"Owning a home is a pathway to building equity and breaking free from the cycle of rising rents, laying a solid foundation for lasting financial stability and wealth creation," explained John Coake, Vice President of Sales at Realty Austin Compass. "Buying a home with a fixed-rate mortgage stabilizes your housing costs and eliminates the frustration of rent increases. This kind of stability is invaluable."

Your Moves Inspire

At Realty Austin Compass, your moves inspire our agents to serve as invaluable guides throughout your real estate journey, alleviating complexities and always advocating for your best interests. They will navigate market trends, decode pricing dynamics, review contracts, and leverage negotiation skills to ensure you can make an informed decision and secure a favorable outcome.

My View

We've seen that the market has been somewhat volatile over the last 18+ months. With economic uncertainty, market moves and local fluctuations in how many are moving to Austin, there hasn't been a clear picture of what is going to happen. However, as I mentioned late last year in a social post, as the interest rates start to come down, prices will go up - which is starting to happen in Austin. Aside from the national news, prices are beginning to move in Austin so if you are thinking of buying or selling, now is the time to start to look

If you want more information on how to buy now and sell later, or if you want some help getting your home ready to sell - please reach out to me as I'm happy to provide you with the resources that will help.