• Nearly 28,480 homes sold in the Austin metropolitan area in the first 9 months of 2020, 4.4% more than the same period in 2019.
• In September, Austin inventories were at 1.2 months. With a single exception, Austin has had 3.0 or fewer months of inventory on the market every month since November 2012.
• Austin’s median home price in 2020, $335,000, is up 6.4% over the first 9 months of 2019. The rate of annual price appreciation in Austin ticked up in 2020 after declining each of the preceding 5 years.

Activity & inventory

The Austin metropolitan area’s new and existing home sales in September totaled 3,892, 31.5% above the number of homes sold in September 2019, and -2.9% below the total for the prior month, according to the latest numbers from the Austin Board of Realtors and the Real Estate Center at Texas A&M. That August-to-September drop is consistent with the seasonal pattern of sales in the Austin market.

Reflecting the pandemic, April and May sales dipped below trend, but monthly totals since then represent the four strongest months for home sales seen in Austin.

The 29,477 homes sold in the Austin metro in the first nine months of 2020 is 4.4% greater than the number sold over the same period last year. Single-family homes, which account for 90% of Austin sales thus far in 2020, are up 4.6% over the same period last year.

National Association of Realtors data for the U.S. show September existing home sales up 24.4% over the volume one year ago, while year-to-date (YTD) sales are down 0.2%. Statewide, September sales are up 27.5% compared to a year ago, and 2020 YTD sales are up 5.1% over the first nine months of 2019.

The dollar volume of Austin metro 2020 home sales through September is 13.1% ahead of the same period last year, while the gains are less statewide (11.6%) and nationally (5.9%). For the month of September, the value of Austin sales is up 51.7% over last September, while Texas is up 44.4% and the nation is up 38.9%.

September 2020’s active listings (3,708) are 49.9% below one year ago. Thus far in 2020, the monthly average of listings on the market (5,761) is down 27.8% from the first nine months of 2019. Listings spent an average of 37 days on the market in September. The average for the first nine months of 2020 is 48 days, and for the same period of 2019, the average was 54 days.

Austin’s months of inventory on the market measure has averaged 1.7 months in 2020-to-date. The average was 2.4 months for the first nine months of last year. In September, inventories are at 1.2 months. The average is 1.0 months for single-family and townhouses and 2.9 months for condominiums.

The last time inventories registered as high as 3.0 months was August 2018. With a single exception, Austin has had three or fewer months of inventory on the market every month since November 2012.

A balanced supply of inventory is commonly considered to be six months. The last time Austin had six or more months of inventory was July 2011, following the Great Recession, and the previous period of six or more months of inventory corresponded to the early-2000s dot-com recession.

Statewide, supply has averaged 2.8 months in 2020 compared to 3.6 over the first nine months of 2019. At 2.3 months in September 2020, statewide supply is down from 2.5 in August and down from 3.6 one year ago. Nationally, the months of inventory declined from an average of 4.0 in 2019 to 3.4 in 2020 on a YTD basis. In September 2020, supply is at 2.7 months, down from 3.0 last month and from 4.0 a year ago.

According to Austin Board of Realtors president Romeo Manzanilla “The housing market is pumping billions of dollars into our region’s economy at a time it’s greatly needed, but we also need to be cognizant of the impact such rapid activity is having on record-low inventory levels and rising home prices. Austin’s suburban markets have historically offered housing stock at lower price points that created opportunity for people when buying or renting inside Austin city limits was not an option. Now, these markets are showing the same gains in prices and declines in inventory as we’re used to seeing inside Austin, putting pressure on the market as a whole.”

Prices

Austin’s median home price in September is $355,000, up by $5,000 or 1.4%, and up from one year ago by $38,190 or 12.1%. Statewide, September’s median sales price is $265,000, up $24,000 or 10.0% from a year ago. The national median price is $311,800, up $15,200 or 14.8% from September 2019.

Austin’s YTD median sales price is $335,000, up 6.4% over the same period of 2019, while the state is at $255,000 and up 6.3%. After steadily declining for several years—falling to only 3.3% in 2019—Austin’s rate of annual price appreciation has jumped up in 2020 based on YTD estimates. The state’s median price growth rate similarly moves from 3.2% in 2019 to 6.3% in 2020 YTD.

The median sales price in the Dallas metro for September is $320,000, up 11.5% from last September; Fort Worth’s median is $265,997, up 8.8%; and San Antonio was at $259,694, or 12.1% higher than one year ago. September data for Houston does not become available until later this month. In August, Houston’s median price was $265,000, up 6.4% from August 2019.

In 2014, Austin’s median price of homes sold exceeded the state median by over 30% for the first time. The differential between Austin and the state approached this level just before the dot-com recession. After falling each year through 2005 (reaching 18%), the difference climbed sharply through 2008 and for 2008-2013 averaged about 29%. In 2015 and 2016, Austin’s median price was more than 33% higher than the state’s median. The differential narrowed to 31% for 2018 and 2019, but YTD 2020 ticked up to 32%. Austin’s home price was 20% higher than the national median in 2016, but has fallen each year since, and is at 15% in YTD 2020.

The average price in Austin in September, at $393,234, is down 1.5% from August and up 15.3% from a year ago. On a YTD basis, Austin’s 2020 average sales price is $425,524, up $8.3% from 2019. For Texas, the average price thus far in 2020 is $309,234, up 6.1% from 2019. The YTD national average price for 2020 is $327,090, 6.1% over 2019.

The following graph illustrates the distribution of Austin metro home sales by price range over the last several years.

The Real Estate Center at Texas A&M publishes market data for ten local market areas within the Austin metropolitan area. Median sales prices for September 2020 ranged from $420,000 in Austin to $239,750 in Kyle. The local market price trends are represented on the two graphs below.

The National Association of Realtors (NAR) produces a quarterly release of price data for existing single-family homes for about 180 U.S. metros. The following table indicates where Austin and the other major Texas metros stack up relative to the fastest appreciating markets among the 50 largest metros.[1] Austin is the 16^thmost expensive major metro in 2019 and in 2020/Q2, Austin ranked 28^thfor price appreciation between 2018 and 2019 and 39^th between 2019/Q2 and 2020/Q2). [NAR’s third quarter data arrives later this week.]

The National Association of Home Builders puts metro market home prices in the context of metro household income levels and property tax and insurance rates. These inputs, along with assumptions about the mortgage and estimated principal and interest, are used to produce the Housing Opportunity Index (HOI) that represents the share of homes sold in a metro area for which the monthly income available for housing of a household earning the metro’s median family income is at or above the monthly cost for homes sold in the quarter.

According to the HOI in 2020/Q3, a household earning Austin’s median family income could afford to purchase 61.1% of the homes sold in Q3. Nationally, a household earning the median family income could afford 58.3% of home sold.

The Chamber’s Economic Indicators page includes an Excel spreadsheet (updated monthly) of Austin, Texas, and national time series data for home sales and prices from the Real Estate Center at Texas A&M and the National Association of Realtors, as well as Housing Opportunity Index data from the National Association of Home Builders.

FOOTNOTE:

1. One large metro, Pittsburgh, is not currently reported in the NAR release. ↩