Central Texas home sales and home prices hit record highs in 2016, the Austin Board of Realtors said Wednesday.
It was the sixth straight year of record sales and prices in the Austin metro area. Economists are predicting a strong housing market for 2017, though perhaps not as hearty as 2016 — there’s even the prospect of the rapid home price increases seen in recent years easing up some.
Austin-area consumers bought 29,569 single-family homes last year, the board said, a 3.9 percent increase over 2015. Half of the homes last year sold for $284,000 and half for less, a 7.2 percent rise in the median home-sale price, the board said.
The dollar volume of sales topped $10 billion for the first time in the region’s history, the board said.
In the final month of 2016 there were 2,373 sales, the board said, a 1.9 percent increase compared with December 2015. The median price for December was $290,000, a 6.9 percent increase over December 2015’s median price.
For several years, the supply of houses, both new and pre-owned, has lagged behind strong demand fueled by the region’s job and population growth, leading to sharp price increases.
However, the board said that slowing home price growth and houses spending more time listed suggests that the market could be starting to return to more normal conditions.
“The Central Texas housing market is slowly beginning to align with long-term historical trends,” said Brandy Guthrie, president of the Austin Board of Realtors. “Homes are spending more time on the market and the pace of both home sales and price growth is slowing. This normalization does not necessarily mean a weakening housing market, but a return to less aggressive market conditions.”
Job growth — the main engine fueling housing demand — has been slowing in Central Texas. The annual growth rate was in the 3 percent to 4 percent range for much of last year before declining in November to 2 percent, according to the Texas Workforce Commission. The last time the annual rate was lower was June 2010, when it registered 1.3 percent as the area was rebounding from the recession.
Despite slowing job growth, “overall the Central Texas economy and housing market continue to be strong,” said Mark Sprague, a local housing expert with Independence Title in Austin. “The 2017 housing market will likely outpace last year’s levels, but at a less robust margin.”
Recent mortgage rate increases “could continue the current pace of home sales growth into the first part of the year,” Sprague said.
By area, the board reported that:
• Sales in the city of Austin were up 1.7 percent last year over 2015, and prices rose at a more moderate pace than in prior years. The median price was $340,000, up 5.8 percent.
• In Travis County, sales were up 3.3 percent last year over 2015, and the median price climbed 6.5 percent, to $330,000.
• Williamson County saw a 2.5 percent increase in sales, and the median price was $260,000, a 6.2 increase over 2015.
• In Hays County, sales were up 7.3 percent last year over 2015, while the median price rose 5.2 percent, to $243,000.
Wes Womack, who leads the Womack Real Estate Team with JB Goodwin Realtors, said 2017 is off to a strong start for his agents.
“For us personally, this January has been the busiest yet,” Womack said. “We have actually already experienced multiple offers on almost all of our listings. I foresee prices ticking up as they tend to have done the last few years in a row.”
Some real estate agents wonder if builders can put houses on the ground fast enough to meet demand.
“Hopefully we’ll have more inventory come this spring, with more choices for buyers,” said Robin Rhoads, an agent with JB Goodwin Realtors in Austin.
Susan Walker, an agent with eXp Realty in Austin, said 2017 is off to a strong start.
“This is supposed to be our slow time of year, and everybody I know is very, very busy,” Walker said.
In recent months, some agents said they felt the market had cooled some from its feverish pace in the past few years.
But Rhoads said homes that are priced right and in desirable locations are still getting multiple offers. If a home is sitting rather than selling, she said, “it’s usually because it’s overpriced.”
“I think some sellers are overzealous, or they tend to not really understand that all houses are not created equal,” Rhoads said. “There are so many variables. The market will dictate what your house is worth.”
Cord Shiflet, an agent with Moreland Properties in Austin, said the luxury market has “six months of pent-up demand from buyers just sitting on the sidelines waiting to see if the world came to an end in November” after the U.S. presidential election.
“Two weeks after the election, phones started ringing again,” said Shiflet, who specializes in high-end home sales. “Two months prior to that, it was absolutely dead. I think we’ll see a very strong spring, as so many people didn’t act in the fall, and they’ll come out of the woodwork really any day now.”