As the national real estate market shows signs of slowing, Unlock MLS data shows homes are generally spending more time on the market and home prices are coming back down in the Northwest Austin area on average.

For homeowners looking to sell, however, this has created a new trend in Austin, with more sellers turning to leasing as they wait for the market to bounce back, Dochen Realty Group Realtor Katie Dochen said.

“We have a lot of what we’re calling ‘accidental landlords;’ people who have this minimum price they could possibly take and they can’t get that price,” Katie Dochen said. “... If you can’t sell for less than that and you don’t want to get rid of the house, then you’re going to have to rent it out.”

For people who bought homes when the local market was at an all-time high in 2021, many homebuyers were offering more than the original listing price to secure homes, Unlock MLS data shows. As the housing market has cooled off, homeowners are struggling to earn their money back, said Renee Livsey, Northwest Austin Sales & Leasing manager for JBGoodwin Realtors.

“Anyone that bought in 2021-22 and that are trying to sell now, I’ve seen people losing money on it,” Livsey said.


As a result of more inventory, leasing market prices are on the decline, and the leasing options for houses are increasing, Katie Dochen said. For May, median single family home lease prices in Austin remained flat compared to the previous year, but prices were down 1.8%-2% in both February and April, Unlock MLS data shows.

“We’ve had several situations where we haven’t been able to get a good enough price for our sellers to sell, and then we put it on the rental market and we’ve leased it out very quickly,” said Realtor Lindsay Neuren with Compass Real Estate.


The approach

Realtor Carol Dochen with Dochen Realty Group said the market remains a buyer’s market, with buyers holding more leverage as their options grow.


Months of inventory measures how long it would take the amount of homes on the market to sell, with six representing a balanced market, according to the National Association of Realtors. In June, MOI in Northwest Austin was 5.5, its highest in over five years, Unlock MLS data shows.

Even so, although home prices are generally lower, some areas have experienced median home sales price increases. Of the 28 homes sold in ZIP code 78750 in May, for example, the median home sales price was almost 75% higher this year compared to the previous year, according to Unlock MLS data.

“Over the past year, ... [inventory] has gone up across the board in all markets. ... That doesn’t necessarily mean the price will go down just because in some of those areas, there’s a lot of nuances,” Neuren said.


Zooming out


The decline in the number of home sales is in line with national trends right now and is an impact of uncertainty in the market, Carol Dochen said.

“No matter what price, no matter what location, I think people are just a little hesitant now,” Carol Dochen said.


One reason behind this is interest rates, Livsey said. Data from Freddie Mac shows 30-year mortgage interest rates rose from 3.82% in the first week of June 2019 to 6.85% the first week of this June. When home sales reached a high in 2021, interest rates were at a historic low of 2.99% for June.

Other possible reasons are the current economic state of the U.S. and ongoing issues in Washington, multiple Realtors said.


Put in perspective

One factor many homeowners look at when selling their house is the average number of days a home spends on the market. While this information is valuable, it’s equally important to remember that it is truly an average, and is not representative of every home seller’s experience, Katie Dochen said.

One example of this trend is ZIP code 78759 in June, which sold the most homes out of the five-ZIP-code coverage area of Northwest Austin. Although the average number of days spent on the market was 38, some homes spent up to an average of 177 days on the market.

“If you don’t sell your house in the first week or two, it’s pretty much a sure thing that you’re probably not going to get the full price that you put on there,” Katie Dochen said.


What the experts say

All four Realtors said homes that are priced and prepared correctly are the ones selling right now.

“You can still sell, [the market] is still moving, you really just have to price it right,” Livsey said.

Part of getting homes to sell is also staging the home correctly with furniture and having good-quality photos, Carol and Katie Dochen said, a process they do with almost every home now.

“Right now, you’ve got to really show your value and have houses that if an appraiser looks at it, ... it will be able to justify the price that’s being asked,” Carol Dochen said.

Ultimately, multiple Realtors also said it is a good time to buy a house right now, given the increasing control buyers have in the market.

“I think in the next year there’s going to continue to be a lot of opportunities for buyers,” Neuren said. “If buyers are financially in a position to buy ... right now is a great time.”