Austin Area Housing Market Shows Continued Signs of Stability: Chuck Farr’s January 2025 Newsletter
Happy new year, homeowners, tenants, prospective buyers, and real-estate investors. If you bought a home last year and if you live there (it is not an investment) and you did not already do so, make a note to file your homestead exemption in January or February 2025 (also check on disability and over 65 exemptions if applicable) at your local county tax office to save money on property taxes. It can save you thousands of dollars this year.
Market Backchannel: As we move into the new year, the Austin area real-estate market continues showing metrics indicating the market is stabilizing after some sporadic downward churn since mid-2022. The latest December Central Texas data from my local realty network shows median sales prices running flat to ticking slightly up year over year. The data shows slow, steady demand over the last year even as higher interest rates continue impacting affordability. Some analysts anticipate a rebound as we head into Spring and move into historical seasonal patterns. Pesky inflation could keep upward pressure on mortgage rates in the near term, though it is impossible to predict the future. Current rates near 7% continue to throttle some buyers. Tech hiring remains slow, though the rate of decline in posted jobs is slowing—another indication of market stabilization.
In the News: According to the Austin Board of REALTORS® and their service, Unlock MLS:
“In 2024, closed sales across the Austin-Round Rock-San Marcos MSA remained stable, ticking down 0.5% to 29,872 sales, according to the December 2024 and Year-End Central Texas Housing Market Report released by Unlock MLS today. During the same period, active listings saw an increase of 14.7% to 132,993 listings offering buyers more opportunities. Together, the data reflects buyers’ ability to find homes that meet their needs within the current market conditions and sellers viewing the market as favorable.
“Clare Knapp, Ph.D., housing economist for Unlock MLS and the Austin Board of REALTORS®, predicts that the coming year will mirror 2024’s conditions offering consistency for homebuyers and sellers.
“‘2025 market activity will likely look similar to trends observed in 2024 with the median sales price and closed sales hovering between a range of 5% up or down year-over-year. This stability will give homebuyers and sellers clear expectations to plan their next steps with greater confidence. Additionally, mortgage rates will likely hover between 6 and 7%, as the Federal Reserve adopts a cautious approach to potential rate cuts. This consistency will allow both buyers and sellers to benefit from a predictable lending environment. However, external factors, such as economic shifts or policy changes, could influence these trends, underscoring the importance of staying informed and adaptable to navigate the market successfully.’
“Brandy Wuensch, 2025 Unlock MLS and ABoR president, emphasized the advantages buyers and sellers have in the new year.
“‘There are unique opportunities for both buyers and sellers this new year. For buyers, the MSA has the highest inventory levels seen in over a decade, offering more choices and greater leverage in negotiations. Sellers, meanwhile, can capitalize on significant equity gains accrued over the past few years. We are finally seeing predictability in our market, making this an ideal time to pursue homeownership goals with the guidance of a licensed professional agent.’
“Austin-Round Rock-San Marcos MSA
“2024
29,872 – Residential homes sold, 0.5% less than 2023.
$445,000 – Median price for residential homes, 1.7% less than 2023.
45,449 – New home listings on the market, 8.7% more than 2023.
132,993 – Active home listings on the market, 14.7% more than 2023.
30,369 – Pending sales, 2.2% more than 2023.
$17,094,934,330 – Total dollar volume of homes sold, 1.5% less than 2023.
“December 2024
2,303 – Residential homes sold, 2.5% more than December 2023.
$450,000 – Median price for residential homes, 1.4% more than December 2023.
2,070 – New home listings on the market, 9.5% more than December 2023.
8,494 – Active home listings on the market, 10.1% more than December 2023.
2,011 – Pending sales, 3.1% more than December 2023.
3.8 – Months of inventory, 0.8 months more than December 2023.
$1,332,504,135 – Total dollar volume of homes sold, 7.0% more than December 2023.
92.2% – Average close to list price, compared to 91.6% in December 2023.”
For folks in the Austin MSA area, if you had bought a house in 2018 at the median price of $305K, its value would have increased to $502K by the May 2022 peak. Median price for the MSA is now $450K, so you would have still done well investing in Central Texas real estate. Check the latest Central Texas Housing Report for more details and data for the city of Austin and surrounding counties.
Winter Home Maintenance Tips: Winter is here--and has its own home maintenance checklist in Central Texas. Here are a few items to consider during January:
· Outdoor Tasks:
o If you are considering doing some big jobs, like HVAC, external painting, or roofing repair/replacement, remember that this is the slow season for many contractors, and you may get a better price and quicker scheduling now.
o Don’t forget to protect your people, pipes, plants, and pets when freezes come to town. Web search for “4Ps winterization” for details.
· Indoor Tasks:
o If you have ceiling fans, consider switching the rotation of the blades to conserve energy and feel warmer in winter months. Usually this means running the ceiling fan at a slow speed and switching the rotation from counterclockwise to clockwise in winter months. Watch this video for details.
o Have your furnace professionally inspected if you did not in the Fall; make sure they check for carbon monoxide leaks. Remember to change out your indoor HVAC filters on a regular schedule.
Issues of this and previous newsletters are located on the Blog tab of my website at www.chuckfarr.com.
