According to the Austin Board of Realtors May 2020 housing market report, homes sales across Northwest Austin in May declined by 40.8% as compared to this point last year.
This is the second straight month of massive declines for the real estate market in Northwest Austin, as defined by the six ZIP codes to which Community Impact Newspaper distributes the Northwest Austin edition. In April, the area experienced a 46.9% decline in year-over-year sales, ABoR data shows.
The ongoing coronavirus pandemic, local real estate leaders said, is contributing to compounding factors that have affected several sections of the real estate market, such as shrinking housing inventory and climbing home prices.
“We're seeing home sales drop because we simply don't have enough inventory on the market," 2020 ABoR President Romeo Manzanilla said in a June 18 news release. "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."
In Northwest Austin, the level of housing inventory—the amount of time it would take for all houses to be sold if no new properties were added to the market—remained relatively consistent from April to May. According to the ABoR report, Northwest Austin had one month of inventory in May, slightly up from 0.9 months of inventory the prior month. That also represents no annual change from May 2019’s inventory.
ABoR in its news release called the Austin metropolitan area's housing inventory—which currently stands at two months—to be “critically low”. The Texas A&M University Real Estate Center considers a balanced market to have 6.5 months of inventory.
“Until more homes are put on the market, we won't see home sales recover anytime soon,” said Mark Sprague, state director of information capital at Independence Title, in the June 18 ABoR news release.
According to the ABoR data, the Northwest Austin market added 211 new home sales listings in May 2020. That represents a 16.9% decrease in new listings compared to the year prior.
Month to month, however, the Northwest Austin market is seeing an increase in new listings and pending sales. In May, ABoR reported 182 pending sales across Northwest Austin, a 44% increase from April’s pending sales numbers.
With fewer homes on the market, the median price of all homes sold in Northwest Austin grew by more than 5% year over year in May. That year-over-year median price growth is actually slower than the rate recorded in May 2019. At that time, the median price of all residential properties sold in Northwest Austin grew by 7.9% as compared to the median price in May 2018.
Further, the median price of $400,000 for all residential properties in May was $25,000 lower than the median price of all residential properties in April.
Compared to the city of Austin’s real estate market as a whole, Northwest Austin’s median home sales price grew at a slower pace year over year when compared to the city of Austin’s real estate market as a whole. According to ABoR’s figures, the citywide median price for all residential properties increased by 10.7% year over year.
With new sales listings and pending sales numbers on the rise compared to April, Manzanilla said he expects the area’s market to make a recovery.
“Pending sales growth is the first sign of recovery, so the strong gains in May pending home sales throughout the MSA is encouraging,” Manzanilla said in the June 18 news release. “With continued population growth and pent-up demand for housing, our region’s housing market will ultimately rebound.”