In another strong month for the Central Texas housing market, home sales soared nearly 13 percent in March, and the area’s median price for those sales reached an all-time high of $255,000, new figures show.
The 2,440 single-family sales set a record for the month of March, the Austin Board of Realtors said Tuesday. The median price was 10 percent higher than in March 2014, with half of the homes selling for more than $255,000 and half for less.
Nationally, March home sales were up 9.9 percent year-over-year, with volume at the highest level of any previous March, according to RE/MAX’s latest National Housing Report of 53 metro areas. The median sales price was $204,000, up 8.5 percent year-over-year.
Reiterating a recurring theme, Barb Cooper, president of the Austin Board of Realtors, said the local housing market “is the least affordable it has ever been.”
“Only three in 10 single-family homes sold in the Austin area in March 2015 were priced less than $200,000,” Cooper said. She said that more than half of the sales were outside of Austin’s city limits.
Housing demand is outpacing supply in the region, and that is continuing to push prices up.
“It is still a seller’s market with not enough inventory,” said Mark Sprague, a local housing market analyst. “The desirable areas and price points have seen little relief on sales volume or values over the last year, which is the sign of a strong market. Most (agents) continue to tell their buyers, ‘the home or apartment you look at today will be gone tomorrow.’”
On average, homes spent 55 days on the market, four days longer than in March 2014, the board said. A report last week from online real estate site Trulia found that 62 percent of homes in the Austin area homes were still on the market after two months compared with 53 percent at this time last year.
“Because employment growth remains solid in Austin, we suspect the housing market has slowed because more inventory is on the market,” said Ralph McLaughlin, housing economist for Trulia. “In addition, solid year-over-year growth in Austin’s housing prices has provided incentive for (more) existing homeowners to put their house on the market compared to last year.”
Local housing industry consultant Eldon Rude he and his builder and investor clients are seeing a shift in the market as the pace of job growth has eased. The Austin metro area had an annual job growth rate of 2.5 percent this March, compared with 3.4 percent in March of 2014, according to Texas Workforce Commission data.
Rude said demand for homes priced below $250,000 has been accelerating, while the price ranges above $500,000 have softened slightly.
“With apartment rents up over 20 percent in the last three years, owning a home is once again becoming more attractive to young people and families who have grown tired of constant rent increases,” Rude said.
Some area real estate agents say it is challenging to find more moderately priced homes, particularly for their first-time buyers.
“We don’t have a lot of affordable homes out there,” said Rachel Goodman, a real estate agent with JB Goodwin Realtors. “House prices are skyrocketing through the roof.”
Goodman said that some of her entry-level buyers are losing out to investors, who are paying cash for more moderately priced properties top turn them into rentals.
“What 30-year-old can compete with an all-cash offer?” Goodman said. “As one of my friends says: ‘Austin, Texas: Where half a million dollars can get you a two-bedroom, one-bath on a highway feeder road.’”