Austin, TX—Once Among the Nation’s Hottest Housing Markets—Is Now the Slowest

Redfin reports unsustainable price growth in recent years, along with a homebuilding boom, has left Austin with more sellers than buyers. That means the buyers who are in the market can take their time and negotiate.

SEATTLE–(BUSINESS WIRE)–The typical home that went under contract in Austin, TX in December spent 106 days on the market, up from 91 days a year earlier, according to a new report from Redfin, the real estate brokerage powered by Rocket. That’s the slowest December in records dating back to 2012.

Nationwide, the typical home that went under contract in December did so in 60 days, up from 54 days a year earlier.

This is based on a Redfin analysis of MLS data, comparing this December to past Decembers because the data is seasonal.

Austin was the slowest market among the 50 most populous metropolitan areas. Tied for second place were San Antonio and Fort Lauderdale, FL, where the typical home that went under contract in December spent 99 days on the market. Next came Miami (92 days) and West Palm Beach, FL (87 days).

“Homebuyers in Austin have the luxury of time and bargaining power,” said local Redfin Premier real estate agent Andrew Vallejo. “I have a buyer who just offered $560,000 for a home that was listed at $599,000 and a few years ago would’ve been worth $700,000. There’s a pretty good chance the seller will say yes, given how slow the market is. Another buyer I’m working with also made an offer on a house for below the list price and plans to bid on a different home if the seller doesn’t accept.”

Austin’s slowdown marks a sharp reversal from recent years, when it often held the title of “hottest” housing market. Austin regularly ranked among the fastest markets from 2014-2016, with homes selling in as few as two weeks. Its housing market again boomed during the pandemic, when Austin saw the fastest home-price growth in the nation as scores of affluent remote workers moved in from out of town. That caused the market to overheat, which is one reason it’s now slowing. Austin’s median home sale price dropped 4.2% year over year in December—the third largest decline among the top 50 metros. Many sellers are taking losses.

Housing markets across Texas (and Florida) have also slowed in recent years due to a homebuilding boom. With more options to choose from, buyers feel they can take their time. Austin had an estimated 128% more home sellers than buyers in December—the largest imbalance among the top 50 metros.

While Austin’s housing market has shifted in buyers’ favor, many house hunters are still waiting on the sidelines. A lot of prospective buyers plan to continue renting until they see mortgage rates fall to the low 5% range, Vallejo said.

“One of my buyers just purchased the home they had been renting, and their monthly payment is going to jump from $2,900 to $6,500 because now they have to pay for mortgage interest, taxes and insurance,” Vallejo said. “They love the property, which is why they bought it, but they’re outliers—most people aren’t willing to take on such a high payment when they can rent for much less.”

To view the full report, including graphs, please visit: https://www.redfin.com/news/austin-texas-slowest-housing-market

About Redfin

Redfin is a technology-driven real estate company with the country’s most-visited real estate brokerage website. As part of Rocket Companies (NYSE: RKT), Redfin is creating an integrated homeownership platform from search to close to make the dream of homeownership more affordable and accessible for everyone. Redfin’s clients can see homes first with on-demand tours, easily apply for a home loan with Rocket Mortgage, and save thousands in fees while working with a top local agent.

You can find more information about Redfin and get the latest housing market data and research at https://www.redfin.com/news. For more information about Rocket Companies, visit https://www.rocketcompanies.com.

Contacts

Contact Redfin Journalist Services:
Tana Kelley
press@redfin.com