Austin MSA Real Estate Market
The Austin real estate market maintained healthy pricing growth and a moderate monthly decline in activity. Population growth continues to push the Austin economy. Higher-priced home sales remained challenged, but the balance of the residential market is strong. The Austin Board of Realtors reported single family home sales in the five-county MSA dropped 4.9% year over year to 2,900 home sales in July, only the second time a decline has been reported in 2016.
The Austin Housing Market:
- “When it comes to sales volume, we’ve grown used to seeing year-over-year increase every single month” said Austin Boardof Realtors President, Aaron Farmer, but it’s important to remember that 2015 had the strongest summer selling season inthe region’s history, the value of Central Texas real estate has continued to increase, which is good news for homeownersbut rising prices could start to have a cooling effect on sales volume in the market amidst growing affordability changes.”1However even with the decrease, the Austin MSA remains a hot market relative to the U.S. In July, listings in Austin moved20 days faster than the U.S. overall and received 39% more views compared to the U.S. average on realtor.com.
- The median home price for July rose to $285,000 an increase of 5.6% year over year.
- Total single-family home inventory remained statistically unchanged from the year prior at 2.8 months’ supply. Inventoryfor home prices from $100,000-$200,000 was less than a 1.0 months’ supply in July. Homes priced over $400,000 had aninventory level around 4 months.2 This inventory is still extremely tight, and the market remains a ‘seller’s’ market. Aninventory level of 6.0 months is a balanced market in which the supply and demand for homes is in equilibrium.
- Single Family Home permits for the month of July totaled 1,221 according to the Texas A&M Real Estate Center, a 6.7%increase year over year.
The Austin Economy:
- Austin reported a loss of 3,500 new jobs in July, a decrease of only 0.4% year over year and only the second loss for 2016.3
- Unemployment in July 2016 ticked up slightly from June at 3.6%, well below the national unemployment average of 5.1%.The Texas Workforce Commission reported the largest decrease of payroll employment was in the government sector(-3.4%) followed by leisure and hospitality (-1.4%) and education and health services (-0.3%). The Austin area's jobless rateis tied for lowest in the state with Amarillo.
- The Texas capital has added roughly 40,100 jobs over the past 12 months, according to the unadjusted data. At the sametime, its combined labor force grew from 1.07 million to 1.11 million.
- Austin ranked number one on CNBC’s new survey, “America’s Best Places to Start a Business,” and according to the 2016Kauffman Growth Entrepreneurial Index, Austin startups grew by 81.2% in the past year, faster than every city exceptWashington.
San Antonio MSA Real Estate Market
The San Antonio area housing market experienced sustainable pricing growth despite a moderate monthly decline in activity. The San Antonio job market slowed for a second month due to job losses in the government sectors. Overall, demand for new housing remains strong with constrained inventories and the housing market remains fundamentally sound. The San Antonio Board of Realtors reported home sales in July decreased by 2% year over year. Low inventory has resulted in a tight seller's market for nearly four years, and was likely a factor in the 2 percent drop in total home sales for July.
The San Antonio Area Housing Market:
- July 2016 had a total of 2,850 sales vs 2,908 in July 2015, a slight decrease of 2%.
- The average home price in July 2016 reached $246,032 vs $239,222 in July 2015, an increase of 3% year over year.
- About half the homes sold in July were priced between $200,000 - $500,000 while homes priced under $200,000 madeup 45.3% of the market.
- Total single-family home inventory remained tight at 3.9 months’ supply consistent with previous months. In fact,months of inventory in San Antonio and surrounding areas has remained at or below 4 months for nearly two yearsand was last at 6 months of inventory in November 2012. Anything below 6.0 months’ supply is considered a tightmarket.
- Single Family Home permits for the month of July totaled 475 according to the Texas A&M Real Estate Center, a 3.4%increase year over year.
- The San Antonio Business Journal reported that the northwest quadrant of the multifamily market is strengthening,with sales price per unit on stabilized apartments increasing 16% year over year.
The San Antonio MSA Economy:
- The San Antonio MSA reported a loss of 11,600 jobs in July, a decrease of 1.2% year over year. The Texas WorkforceCommission reported the largest decrease of payroll employment was in the government sector (-3.6) percent followed byprofessional and business services (-1.7%) and leisure and hospitality (-1.2%).
- Unemployment in July 2016 ticked up slightly from June at 4.2%, well below the State and national unemployment averageof 5.1%. 6
- Despite the one month slowdown, “the San Antonio area continues to be one of the most affordable markets in Texas,” said Bob Jacobs, SABOR’s 2016 /Chairman of the Board.”
- Continued population growth and geographical expansion continue to support the overall San Antonio commercial and residential real estate markets.
Should you have any questions, please feel free to contact our office at (713) 535-2250. For more information on our company, please visit our website at www.mcalisterinv.com .
Jim McAlister, Sr.