The Austin housing market has certainly seen declining sales in the last few sales, but how is it faring now?
I took a look at annual MLS sales over the last few years to compare the top and bottom halves of the market, taking $300,000 as an approximate mid point for single family detached homes within the City of Austin.
Above $300,000 the proportion of listed homes that failed to sell (listings expired or withdrawn) was 54% in 2008, but went down to 52% in 2009. Compare that with 43% in 2007. Certainly the number of sales are down, it seems that less sellers are trying to sell now, and of that group, more are succeeding.
In the under $300,000 market, things seem much better. While sales volume is down, it’s not down as much as the higher part of the market. (31% down vs. 40% down from 2007-2009)
The portion of homes failing to sell in the lower end of the market is also much less – 31% in 2009 compared to 38% in 2008, and 27% in 2007.
So as might be expected, the lower half of the single family home market has not slowed as much as the upper half, and seems to be recovering faster.
There are various changes afoot at the national level that may shake things up a little in 2010. FHA loans are essentially going to become more expensive after Spring 2010 – they now make up around 30% of the purchase loan market in the US, and closer to 50% in the first time home buyer market. So that will probably put the brakes on the demand side.
Also, mortgage rates are still low, though many expect them to increase without more help from the Federal Government. The tax credit is planned to expire by the end of Summer 2010.
The “sale now on!” message that the macro-economic picture paints is designed to get people into a “buy or sell now” mentality. If this “sale” ends after the summer, it could be a very quiet second half of the year.