Austin's real estate market is shifting, slightly
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With pending home sales down, Austin's real estate market is showing early signs of slowing down. But home prices are still up nearly 20% from May 2021.
Why it matters: We keep hearing about a market crash, but so far, local data doesn't support that.
Yes, but: Monthly data shows early signs of a cooler market, even if it's slight.
What's happening: From May 2021 to May 2022, new listings were up 19.2% and pending sales were down 4.4%.
- More buyers are holding off as home ownership becomes too expensive.
- This comes after mortgage rates surpassed 5% for the first time in 10 years.
- More sellers are dropping their asking price. There was a 24.2 percentage point increase in price reductions year over year in June, according to Redfin.
- Meanwhile, there was a 14.1 percentage point decrease in homes sold for over asking, per Redfin.
Zoom out: Nationally, mortgage applications were down 24%, and on average, 6.5% of sellers dropped their asking price each week in June, per Redfin's latest market update.
- In June, national pending home sales were down 13% from this time last year, the largest decline since May 2020, Redfin's report stated.
Be smart: Inventory is still critically low overall, which continues to push home prices up.
What we're watching: New listings and pending sales. If more listings flood the market this summer and buyers don't bite, that's when we would start to see more power shift into buyers' hands.
Bottom line: We're not seeing major changes in Austin just yet.