Last year was a whirlwind for almost all aspects of our lives, and the real estate industry was no exception. In the midst of a world-wide pandemic we saw something unusual occur in the Austin real estate market, there was no slow down. Usually, the Austin market is fairly predictable. Spring is the busy season. This is when there are the most active buyers looking to purchase a home, and the largest percentage of home sellers choose to sell during the same time frame in order to capitalize on the highest sales price potential. This year was a bit different. Buyers didn’t stop at the end of July, and they are still out there buying anything they can get their hands on. However, that isn’t much since sellers are not deciding to list their homes at pace with buyer demand. At the time of writing this, there are only 71 active single-family home listings in Austin for under $500K!
A number of factors have contributed to the omni-present buyer demand in the Austin real estate market. Buyers are taking advantage of record low interest rates. People are looking for more space as the reality of working from home indefinitely sets in, and large corporations are moving here in droves. All of these factors have resulted in a shockingly low level of homes for sale in Austin. In December of 2019, there were 1,285 active single family home listings in Austin. In December of 2020, there were only 521. As with any case of supply and demand, this is driving prices through the roof. Multiple offer situations that push the sales price well above the asking price are common occurrences at almost every price point in the Austin market. If you are submitting an offer to purchase a home right now, it’s not unusual to provide an appraisal waiver addendum that declares you are willing to bring additional cash to the table if the home does not appraise.
What does this mean for you?
If you are considering buying a property in Austin right now, understand that the market is incredibly competitive. You may not be able to get your dream home, or you may have to place offers on multiple properties before finally going under-contract on one. There should be an increase in listings this spring that will alleviate the market to some extent, but I would also expect prices to rise throughout the typical spring selling season. The bottom line is that if you are prepared to deal with the harsh conditions that the Austin market presents right now, you are likely better off buying now than waiting.
If you are thinking about selling your home, there has never been a better time. You can expect to sell your home quickly and for an unprecedented price. That being said, if you hold off until the spring, you may make a bit more. Ultimately, it’s up to your unique situation to determine if now is the best time to sell for you.
If you have specific questions about what’s happening in the Austin market and your best course of action, feel free to contact me anytime!
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