Austin, TX Real Estate Market Trends & Analysis 2019

Key Takeaways

  • Home prices in the Austin real estate market have increased 62% from their pre-recession peaks.
  • Real estate in Austin has increased in value at a faster pace than all other qualifying cities in Texas.
  • Austin real estate investing continues to remain supported by strong underlying fundamentals.

The Austin real estate market has become one of the most active real estate markets in all of Texas, if not the entire country. With a burgeoning technology industry, relatively low housing prices (at least compared to many coastal cities), and plenty of demand, real estate in Austin has become a bit of a commodity. The culmination of several indicators, in fact, have made Austin more desirable to prospective homeowners than ever before. Meanwhile, amidst all the positive news, more and more neighborhoods in the Austin real estate market are shifting more in favor of buyers, which bodes incredibly well for local investors.

Austin Real Estate Market Overview

  • Median Home Value: $368,600
  • 1-Year Appreciation Rate: 6.5%
  • Median Home Value (1-Year Forecast): 3.4%
  • Median Rent Price: $1,700
  • Average Days On Market (Zillow): 49

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Austin real estate investing

Median Home Price Austin

Median home values in the Austin real estate market have appreciated at a faster rate than the national average over the last year (March 2018 through April 2019), 6.5% and 6.1% respectively. After a year of higher-than-average increases, the median home value in the Austin housing market now sits comfortably at $368,600. It is worth noting, however, that Austin’s current housing trends suggest the city will continue to appreciate for the foreseeable future, albeit at a tempered pace. According to Zillow, Austin real estate investors should expect prices to increase by as much as 3.4% in the next 12 months. While nearly half the pace of the previous year, Austin’s rate of appreciation is nothing to be concerned about, but rather a sign that things may be returning to normal. As a result, we may be able to expect a median home value in the Auction real estate market somewhere around $381,000 by this time next year.

Austin Foreclosure Statistics

According to RealtyTrac, a nationally recognized real estate information company and online marketplace for distressed properties, the Austin real estate market is home to approximately 277 properties that are currently at some point in the foreclosure process (default, auction or bank owned). At their current level, the number of properties that have received a foreclosure filing is 7% less than this time last year.

Of the properties identified by RealtyTrac, 51.2% are what professionals in the real estate industry call “auction” homes; that means the property has already been repossessed by the loan originator and is currently either up for auction, or will be in the near future. While they currently represent the majority of Austin’s distressed properties, the number of auction homes has declined 40.5% since the previous year. That said, the decline of auction homes is directly correlated to the increase in bank-owned homes. The homes that failed to sell at auction (bank-owned homes) now represent 48.8% of Austin’s distressed homes, as a great percentage of the auction inventory appears to have turned into bank-owned inventory.

In all, one out of every 6,409 properties in the Austin real estate market are considered distressed, which may not sound like a lot. However, each of those homes represents a unique opportunity for Austin real estate investors, as long as they know where to look. That said, here’s a breakdown of the neighborhoods in Austin with the highest distribution of distressed properties:

  • 78733: 1 in every 1,517 homes is currently distressed
  • 78738: 1 in every 1,684 homes is currently distressed
  • 78734: 1 in every 1,727 homes is currently distressed
  • 78721: 1 in every 2,316 homes is currently distressed
  • 78725: 1 in every 2,598 homes is currently distressed

Austin Real Estate Investing

With median home values up approximately 6.5% in the last year, and expected to reach as high as $381,000 by as early as this time next year, Austin remains incredibly attractive to homebuyers. Despite the latest bout of appreciation, which has seen home prices increase 62% from their pre-recession peaks, however, buyers are still coming out in droves to participate in the market. Due, in large part, to the city’s growing technology industry and increasing job opportunities, millennials have made Austin a popular destination for first-time homebuyers. Meanwhile, price increases aren’t scaring anyone away, but rather shifting towards a more buyer-friendly marketplace.

According to a study released by Trulia, more than half of the neighborhoods in the Austin real estate market have shifted in favor of buyers in the last year. Consequently, Austin is now a buyers market, which will serve local real estate investors very well. If for nothing else, it’s the demand (combined with rising values) that is working most in investors’ favor.

“Because Austin’s economy is thriving and the city continues to remain one of the most popular living destinations in the country, the housing market remains extremely tight,” Kevin Scanlan, 2019 president of the Austin Board of Realtors, says in a release.

Lower inventory levels, combined with plenty of demand, suggest investors may be able to expect higher profit margins. More people are trying to move into fewer homes, which could create a bidding war over real estate assets.

Austin Real Estate Market Summary

The Austin real estate market, not unlike the majority of markets across the country, has seen its lack of available inventory drive up prices in a relatively short period of time. However, real estate in Austin still remains in high demand. Thanks, in large part, to a thriving economy and booming tech industry, demand doesn’t appear as if it will taper off anytime soon. As a result, Austin real estate investors can expect an active and profitable summer selling season.

Have you thought about investing in the Austin real estate market? If so, what are you waiting for? We would love to know your thoughts on real estate in Austin in the comments below.

*The information contained herein was pulled from third party sites. Although this information was found from sources believed to be reliable, FortuneBuilders Inc. makes no representations, warranties, or guarantees, either expressed or implied, as to whether the information presented is accurate, reliable, or current. Any reliance on this information is at your own risk. All information presented should be independently verified. FortuneBuilders Inc. assumes no liability for any damages whatsoever, including any direct, indirect, punitive, exemplary, incidental, special, or consequential damages arising out of or in any way connected with your use of the information presented.
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