In this analysis, we delve into the unique dynamics of the Austin-Round Rock real estate market, contrasting it with other major U.S. metro areas. Notably, Austin experienced a significant price decline over the past year, contrasting with nationwide trends. We analyze sales data by price range, focusing on shifts in market share among different price segments from 2020 to 2023. This article aims to provide agents and the community with insights into the market’s nuances, though readers should verify the data independently for accuracy and current relevance.
According to this Redfin article, Austin stands out as the only major U.S. city among the top 50 in terms of population to report a price decline in the 12 months ending November 2023, a notable -6.2%. This positions Austin’s market in stark contrast to other populous metro areas, where prices have generally increased. The implications for Austin-Round Rock area Realtors are significant, as they navigate a market narrative different from their counterparts nationwide.
Our team at Capital City Coordination delved deeper into the price distribution data, using information from the Texas A&M University – Texas Real Estate Research Center. By focusing on the $250K to $749K range from 2020 to 2023, we discerned patterns affected by interest rates and shifts in market share. We divided our analysis into two parts: 1) the trends from 2020 to 2022 and 2) the notable changes in 2023.
The Gainers:
- 2020 – 2022: A sharp decline in market share from 18.1% to 3.2% was observed, indicating a rapid heating of the Austin market. This drop establishes a new lower threshold in the $300K-$399K range.
- 2023 Changes: Sales in this range nearly doubled from 3.2% in 2022 to 6.5% in 2023, hinting at a potential temporary bottoming out in this price range if trends persist into 2024.
- 2020 to 2022: This range absorbed market share from the lower segment, becoming the primary market bottom during this period. A more gradual decrease in this period suggests its viability.
- 2023 Changes: A significant increase in market share to 27.8% in 2023, the highest since 2011, marks this as a current sweet spot in the market.
The Losers:
- 2020 to 2022: Market share grew from 14.1% to 24.1%, a trend aligned with shifts in the lower price ranges.
- 2023 Changes: A slight decrease to 21.5% in 2023, though still higher than the 2020 market share.
- 2020 to 2022: This larger price range saw a substantial increase, reflecting a desire for larger, more expensive homes, possibly driven by remote work trends.
- 2023 Changes: Despite a decrease to 24.1% in 2023, this range maintains a significant market share.
Conclusion: The Austin-Round Rock real estate market is undergoing notable shifts. Higher rates have affected affordability, leading to adjustments in seller expectations. The “losers” saw a decrease in market share from 54.5% to 45.6%, while the “gainers” increased from 23.1% to 34.3%. It remains to be seen if this trend towards more affordable pricing continues into 2024 or if the market experiences a rebound.
Disclaimer: Capital City Coordination periodically analyzes various facets of the Austin real estate market, aiming to provide straightforward information to our agents and community. However, this analysis should be viewed as an initial exploration, and we encourage readers to verify data and trends for current accuracy and applicability.
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