Austin Real Estate Market Continues Strong Home Sales — Much of it Outside City Limits

We all know that Austin is a hot real estate market — one of the hottest in the nation at that. But it’s also pretty obvious that Austin housing has gotten a lot more expensive in a short period of time.

The rising cost of homes in the city is driven by the demand generated by a nonstop influx of high-paid new residents. Those rising costs and fierce competition for houses near downtown is one of the primary reasons more than half of the Austin area’s record-breaking home sales in February happened outside the city limits.

Likewise, the rising costs mean profit potential for people who already own a home in Austin and are considering moving — perhaps for new work or to accommodate a growing family.

That spillover from Austin’s competitive market is a boon for neighboring communities, most of which are thriving. Cedar Park and Round Rock, for example, regularly sit near the top of the charts for growth and quality of life for families.

According to the Austin Board of REALTORS®, the 1,775 Austin-area single-family home sales in February represented a 5 percent increase compared to February 2014. That set a new record for February sales.

Median home prices, meanwhile, climbed 8 percent to set an all-time high of their own in February at $248,640.

But, remember, more than half of those sales happened outside city limits where a larger inventory of affordable homes are available.

2015 ABoR President Barb Cooper said the strong growth in suburban areas comes at a cost.

“This growing urban sprawl has put a strain on our region’s infrastructure,” she said. “Long-term and sustainable solutions for statewide transportation funding in addition to policies that allow more affordable housing options inside Austin’s city limits will be critical to making Austin an affordable place to live for all residents.”

Despite strong sales, homes spent about three more days on the market this February than last year, reaching an average of 58 days.

While the number of active listings rose by 9 percent to 5,142 listings, the area’s housing inventory remains low, despite some meager gains in recent months.

Condo sales slowed down by 4 percent compared to February 2014, and the median price fell five percent to $196,580. Home leases, meanwhile climbed by 10 percent, with 1,265 leases signed in February for a median price of $1,450 — about 4 percent more than last year.