COVID-19 exacerbates inventory shortage in Austin area; home sales drop

AUSTIN, Texas—The Greater Austin area continued to feel the stark effects of COVID-19, as  housing  inventory dropped to critically low levels of less than 2 months of inventory in Austin, Travis County and Williamson County, according to the Austin Board of REALTORS® (ABoR) latest Central Texas Housing Market Report.

Compared to May 2019, residential sales in the five-county Metropolitan Statistical Area (MSA) decreased 29.2% to 2,697 sales, while  sales dollar volume dropped 30.8% to $1,092,374,935. At the same time,  the median sales price  increased 0.7% to $329,893 and homes spent three fewer days on the market—an average of 47 days. 

"We're seeing home sales drop because we simply don't have enough inventory on the market," Romeo Manzanilla, 2020 ABoR president, said. "We recognize there’s still an element of discomfort with listing one’s home during the pandemic and Austin REALTORS® are taking every precaution to ensure safe and efficient practices across the market. There’s a lot of opportunity for sellers who are ready—new listings  have increased visibility and homes are spending less time on the market." 

Mark Sprague, state director of information capital at Independence Title, said that although real estate was deemed essential, it was significantly impacted by the  slowing economy. 

"If you compare Austin's home sales to the majority of large cities in the U.S., you'll find Austin's market has remained strong," Sprague said. "But,  because sales numbers have a  one-to-three-month lag time, it was no surprise  May  sales declined and we'll likely see the same in June and July.  The solution is increased housing stock. Until more homes are put on the market, we won't see home sales recover anytime soon." 

In the Austin-Round Rock MSA, an  18.8%  decline to 6,086 active listings pushed  housing inventory down  further  to 2 months, 0.6  months lower  than May 2019. During the same period, new listings declined 15.8% to 4,151 listings, while pending sales jumped 14.2% to 4,287 sales.

“Pending sales growth is the first sign of recovery, so the strong gains in May pending home sales throughout the MSA is encouraging,” concluded Manzanilla. “With continued population growth and pent-up demand for housing, our region’s housing market will ultimately rebound.”

City of Austin

In the city of Austin, continued demand and limited inventory drove home prices up, as sales dropped due to fewer listings. The median price for residential homes increased 10.7% year over year to $424,050. Residential sales  decreased  36.6% to  826  sales,  and sales  dollar volume  decreased  32.5% to $418,410,453.  During the same period, new listings fell  18.7% to  1,348  listings,  active listings  decreased  13.5% to 1,684  listings  and  pending sales declined 4.9% to  1,216  pending sales. Monthly housing inventory decreased 0.2  months  year over year to 1.7 months of inventory. 

Travis County

At the county level, residential sales  declined 33.8% to 1,319  sales,  and sales dollar volume  dropped  35% to $644,917,945. The median price for residential homes increased  4.7% year over year to $398,345. During the same period, new listings decreased  17.1% to 2,162  listings, while active listings declined  19.7% to  2,959  listings.  Pending  sales  slightly increased 1.1% to 2,016  pending sales. Monthly housing inventory decreased 0.5  months year over year to 1.9  months of inventory. 

Williamson County

In Williamson County,  May  residential sales  decreased by 27.1% to 914  sales, and sales dollar volume  decreased  26.4% to $297,560,285. The median price  fell 2.7% to $290,000. New listings dropped 20.1% to  1,692 listings, while active listings  slightly  decreased  23.7% to 1,826  listings. Pending sales  jumped 23.6% to 1,497  pending sales. Housing inventory declined 0.7  months year over year to 1.8  months of inventory. 

Hays County

In Hays County, May residential sales fell  19.1% to  340  sales,  and sales dollar volume decreased  20.5% to $115,545,478. The median price for residential homes declined by  0.8% to $265,900. During the same period, new listings  slightly decreased  0.4% to  528  listings, and active listings  decreased  8% to 890 listings. Pending sales  jumped 44% to 583  pending sales. Housing inventory decreased 0.5  months to 2.6  months of inventory. 

Bastrop County

In May,  Bastrop County residential sales  fell  13% to 100  sales,  while  sales dollar volume  decreased  10.1% to $28,723,638. The median price for residential homes increased 9.3% to $260,000. During the same period, new listings  decreased  5.6% to  152  listings,  active listings  decreased 8.5% to 323  listings, while pending sales  jumped 29.1% to 151  pending sales. Housing inventory decreased 0.6  months to 3.5  months of inventory.  

Caldwell County

In Caldwell County,  May residential sales  decreased  14.3% to  24  sales,  and sales dollar volume  decreased by 13.5%  to $5,077,774. The median home price dropped  12.1% year over year to $179,900. During the same period, new listings  fell 7% to  40  listings,  active listings  decreased  14.6% to 88  listings, while pending sales  jumped  42.9% to  40  pending sales. Housing inventory  decreased  0.7  months to 3.5 months of inventory.  

For more information  or  to download the  May 2020 Central Texas Housing Market Report, visit http://www.abor.com/statsmay20.