March is here and the Austin area housing market is really heating up. In fact, the market is on fire. In many areas of Austin Tx, sellers are receiving multiple offers on the first day on the market. I wrote an offer this morning on a home that had 17 offers after 3 days on the market. For sellers, there has never been better a time to sell. For buyers, you need to be prepared to be aggressive and enlist the service of an extremely experienced agent who is skilled at operating in this type of competitive market. So let's take a quick look at the market numbers for February 2013.
Market Snapshot (city of Austin Home Sales)
- 698 Single-family homes sold, 12% more than February 2012.
- $319,196 - Average price for homes was 3% more than February 2012.
- 53 - Average number of days that single-family homes spent on the market, 27% fewer days than the same month in 2012.
- 98% Sales Price/Original List Ratio, 4% better than last February.
To summarize, homes in Austin Tx are selling much faster than last year at this same time of the year. Homes are also selling for 98% of original list price, so sellers are getting very close to their asking price.
There are fewer homes on the market (lower supply) yet more homes are selling (higher demand). It doesn't take a degree in economics to recognize the result of low supply and high demand on prices...they go up!
Austin is definitely in a seller's market, but why are so few owners electing to take advantage of a seller's market? My theory is that owners are afraid of the unknown. Many home owners I speak with say they are afraid that if their home sells quickly they may not be able to find the perfect next home in a short period of time. They also worry about overpaying. My response to this concern is that with historically low interest rates most owners with equity are going to be able to move up to a larger or more luxurious home and still keep your monthly note very close to your existing note.
With so much demand from buyers, a popular solution for moving up is a leaseback. A leaseback is when you close on your home then lease the home from your buyer while you find a new home. With a large pool of available buyers it has become much easier to find buyers who are willing to agree to this arrangement.