Strong population growth causes home prices to spike, inventory to drop in local markets with strongest demand
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February is typically a slow month for home sales, but the Central Texas housing market didn’t slow a bit last month, according to the latest report from the Austin Board of REALTORS® (ABoR). The February 2018 Central Texas Housing Market Report showed that while home sales volume across the Austin-Round Rock Metropolitan Statistical Area (MSA) grew in February, areas with the highest market demand and lowest inventory experienced double-digit percent price increases and annual declines in sales activity.
“Last month, economists predicted an upwards of 5 percent growth in median home prices within the Austin area, and we have far surpassed that,” Steve Crorey, 2018 president of the Austin Board of REALTORS®, said. “This is especially evident in local markets where housing demand is strongest, such as Austin and Cedar Park. Home price increases are sharpest in these markets, while dwindling housing inventory in the lower price classes could be discouraging people from buying.”
In the Austin-Round Rock MSA, home sales increased 5.7 percent year-over-year in February 2018 to 1,955 sales. The median price of single-family homes increased 3.6 percent to $299,900. Housing inventory remained flat at 2.0 months, the same as last February.
“While wages and jobs in the Austin area haven’t increased, the local economy remains strong and continues to attract new residents and potential homebuyers,” Mark Sprague, state director of information capital for Independence Title, said. “This population growth is putting additional pressure on local housing markets with already critically low housing inventories, leading to sharp price increases that both homebuyers and new home developers cannot keep up with.”
City of Austin
In the city of Austin, the median price for single-family homes increased 12.2 percent to $367,701 year-over-year in February. Single-family home sales decreased 6.7 percent from the same period last year to 599 sales. Inventory decreased from 1.4 months of inventory in February 2017 to 1.3 months of inventory this year.
Williamson County experienced a double-digit increase in sales volume, while median price growth remained relatively flat. Single family home sales increased 13.1 percent year-over-year to 689 sales in February 2018, and the median price increased 1.1 percent to $275,000. Overall, housing inventory of single-family homes in Williamson County increased slightly to 2.0 months of inventory, compared to 1.9 months of inventory in February 2017.
In Cedar Park, February sales decreased 6.8 percent to 69 sales, while the median price of single-family homes increased 12.5 percent to $329,000. In Leander, where there’s a greater supply of new homes, February sales increased 13.9 percent to 82 sales, and the median price of single-family homes decreased 6.6 percent to $269,900. Round Rock experienced a subtle increase in sales–2.8 percent from last February to 109 sales; median home prices increased 6 percent to $263,840.
Hays County also showed a significant increase in home sales. February sales increased 12.1 percent to 222 sales compared to the previous year, and the median home price increased 6.7 percent to $255,000. Across the county, housing inventory decreased to 2.2 months of inventory, compared to 2.5 months of inventory the previous year.
Sales in Buda decreased 3.5 percent year-over-year to 28 sales, and the median home price remained unchanged at $279,900. Kyle experienced a significant increase in sales—a 21.2 percent increase to 63 sales—compared to the previous February. The median price increased slightly 2.8 percent to $213,000.
For more information on the February 2018 Central Texas Housing Market Report, visit www.abor.com/statsfeb18.
The Austin Board of REALTORS® (ABoR) is a nonprofit organization that has been serving the needs of Austin REALTORS® and consumers for more than 90 years. ABoR provides technology, education and advocacy for more than 13,000 members, as well as monthly housing market reports for Travis, Hays and Williamson counties. ABoR’s market reports include the most accurate multiple listing service (MLS) findings for the Austin area. For more information, contact the ABoR public relations team at email@example.com or 512-454-7636. For the latest local housing market listings, visit AustinHomeSearch.com.