Is the housing market cooling off?
This is one of the biggest questions that buyers and agents have been asking over the past few weeks!
Between Mother’s Day, graduations, and Memorial Day, there’s been a “feeling” that the craziness is starting to temper, but is it REALLY the case?
Well, to answer that question objectively, I pulled up stats for the past 5 years:
You can see that there is a slight increase in sales starting last summer and going into 2021, but pretty consistent with the previous 5 years, going back to 2016. The “blue” area represents the number of sales and with an exception of a slightly slower March 2021, it looks exactly like one would expect.
HOWEVER, when you look at the green area, which represents the number of active listings, you can easily see why the market is behaving the way that it is… It’s simply Economics 101…
There was a spike in inventory in the summer of 2016, but sort of went back to normal in 2017. Once the pandemic hit, the inventory took a nosedive and has not come back… Yet more and more people are making the move to the Austin area.
So WHY do people feel like the craziness is slowing?
1. “Holiday weekends” We’ve gotten so accustomed to homes going on the market on Thursday, 721 showings between the launch date and Sunday, and an offer deadline by Sunday night or Monday sometime… that when people are busy with other ‘life’ activities and not looking at real estate, it seems slower!
2. Buyers have taken a step back. They’re not so frenzied with the fear of missing out and many are sort of taking a deep breath and pausing a bit. This doesn’t mean offers aren’t coming in over asking and multiple offers, but we’re seeing FEWER competing offers on a weekly basis. Where we might have seen 10-15 (or 97+ in one case), we’re seeing 3,4,5… maybe 10… but WAY LESS than we were seeing previously.
3. Life is going back to normal! This is purely opinion… but to be great at reading markets, you need to be able to look past data alone. Let’s face it… we’ve all been locked down since March of 2020. Within the past few weeks, things have opened up. People are taking vacations once again. People are enjoying seeing friends and family and getting to experience “normal” once again.
4. Prices have appreciated a lot in the past 12 months! I don’t want to put a specific number here because every area, even zip code or subdivision is different! My neighborhood has seen a year-over-year appreciation of 68% according to a recent article posted on Fortune.com. Others have been closer to 15-20% (If you want to know stats on a specific neighborhood, let me know and I’m happy to pull them). With that, many owners are simply sitting tight and/or updating/renovating their current homes and opting to stay put.
So, what does all this mean?
In a nutshell, I don’t think the demand is going to slow any time soon… so there is still time to get in and capture some of the appreciation. We have so many jobs being created and Austin is still one of the top destinations in the country for so many reasons.
We have over 11 different ways to find you the right home so if you want to be IN your new home before the end of this year, let’s connect this week to go over the plan!
And if you’re needing to be in before school, let’s schedule ASAP!
P.S. Let’s put your plan in place… Schedule a call here.
