Austin, Texas has long been considered one of America’s burgeoning cities. With a great city culture of food and music, tons of economic opportunity, and a strong real estate market, Austin is a trendy city that people have been flocking to in droves. With the hype that comes from being considered a rising powerhouse of a city, comes a large migration.
Part of the initial appeal to Austin was that it was an affordable city that can offer buyers all the great aspects of living in a cultural hub. But in recent years, the once-affordable city has gotten much less so.
According to a report by Norada Real Estate, the value of the Austin Metro housing market grew by $141 billion, or 126% in the past decade. This is massive growth, that corresponds with a huge surge in population. According to a report by Austin Chamber, the Austin Metro area’s population has gone from 1,716,289 in 2010 to 2,227,083 at the end of 2019.
Buyer desire is extremely high right now, as work from home has given people the freedom to relocate, and the desire for a larger space.
This is a surge of 29.8% growth over the course of the decade, making it one of America’s fastest-growing big cities. Meanwhile, the growth of Texas’ population over the same time span is a much less significant 15%.
According to the same report by Norada, Austin’s home values have appreciated close to 91% since 2012. The average cost of a home has gone from $223,00 to $427,116 in that time frame. With this substantial rising in price, it doesn’t mean that sales numbers are down.
Right now, it’s a sellers’ market, with most cities in America having a higher demand for real estate than supply. In Austin, houses are flying off the market despite the price increase.
According to another report by Norada, home sales across the Austin Metro area were up 29% this September compared to last September, with a total of 3,780 sales this September. However, active listings are down by 50% compared to last year. One reason for this might be the speed that houses are coming off the market.
In October of 2020, the average house was on the market for 35 days, which is significantly less than the 54 days the average house spent on the market in October of 2019.
Here, the implications of the COVID pandemic and the government response are felt. Mortgage rates are extremely low right now, as are interest rates. While the prices of homes in Austin are indeed high, there is still a ton of incentive for buyers to pounce on a house right now. For one, the aforementioned low interest and mortgage rates. Another reason is that Austin’s continued growth seems assured. The price of a house in Austin has continued to only go up year over year, so it appears like a very sound investment.
Buyer desire is extremely high right now, as work from home has given people the freedom to relocate, and the desire for a larger space. While there are many desirable cities for buyers to look to, few cities can match the mixture of growth, the strength of investment, and cultural excellence that Austin can. So while the hype has driven Austin’s population, which has sent real estate prices soaring, Austin still represents an excellent place to settle down for the average buyer.