Austin Market Slowing? (San Diego: insurance, condo, homes)

[gigi927]

Originally Posted by ExitusLSU

That's pretty funny consider this Saturday, while looking at some communities up in Cedar Park, one of the agent mentioned that a lot of people were moving into Cedar Park from Steiner Ranch because of taxes and the current price of the home in SR.

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Hm. That seems interesting. Overall, yes, you get less for your $ in SR than you do in most of CP, but there are tons of affordable homes in Steiner, and there are tons of very upscale expensive homes in parts of CP.

What your agent said about taxes concerns me a little. I like to think of our property taxes as coming in two big chunks - one from the school district and one from the county taxing authority (this is simplifying things substantially but basically correct - at least for our part of town). Both Cedar Park and Steiner Ranch are in the Leander ISD. So - the school portion of taxes in both CP and SR should be roughly comparable on two houses of similar value as they are being assessed by the same school district. And the school portion of our taxes is the largest portion of the bill. It's only the county taxing authority portion where there might be a difference. Steiner is in Travis County and CP is mostly (if not all) Williamson, if I'm not mistaken.

If you were looking at Steiner and ruling it out because only of taxes, I might press your agent for a bit more information or an explanation - or run the numbers yourself on two equivalent houses and see where the gaps might be, if there are any! Good luck!

[FromCalitoSteinerRanch]

Originally Posted by ExitusLSU

That's pretty funny consider this Saturday, while looking at some communities up in Cedar Park, one of the agent mentioned that a lot of people were moving into Cedar Park from Steiner Ranch because of taxes and the current price of the home in SR.

Let me guess, the agent you mention is working in one of the Cedar Park subdivisions?

To me, with bias and all, it seems odd that folks would move away from Exemplary schools, and ~2.71% tax rate, taking into account moving costs, the hassle, etc. What is the tax rate you were being quoted, and what did they say SR's was?

[gigi927]

Originally Posted by FromCalitoSteinerRanch

thanks for that Gigi! Since I think there are about 3000 houses now in SR, then 178 homes is about 5.9% of the homes on the market. Since I am not a realtor, I don't know if that indicates a tight micro market or not, but it is certainly better than 10% or 15% on the market. I don't know of any market with that many, so just pulling the 10 or 15 out of thin air as an unsubstantiated refernce figure.

I guess I would like to know how many are closing each month. It is it 10 homes a month, then I will be curious why, but if it's 30 homes a month, then that is still less that 6 months inventory, assuming nothing is added each month...

they didn't break out closes each month by neighborhood, unfortunately.

the chart does show overall for RN there is roughly 7 months of inventory; in 2006 the average was 6 months of inventory. However, both the 2006 and 2007 numbers are substantially skewed by the higher end homes ($600K and up) having 7-12+ months of inventory thru-out the calendar year. Right now in those high ranges, some of the pricing bands have up to 39 months of inventory!

In the $300-$500K price range, inventories are 5 to 7 months right now; in 2006 they were 4 to 5 months.

They don't really define how they specifically calculate their months of inventory, BTW. I could play with their Excel formulas but that would give me a headache

[Torontonian]

Originally Posted by gigi927

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Hm. That seems interesting. Overall, yes, you get less for you $ in SR than you do in most of CP, but there are tons of affordable homes in Steiner, and there are tons of very upscale expensive homes in parts of CP.

I've met couple people who moved from Steiner Ranch to Cedar Park. It wasn't because of taxes but rather because of schools and proximity to High school / 183 Highway

Regarding inventory in Steiner Ranch. As somebody pointed out California started making sense again and people leaving. I checked couple of the houses for sale, they are empty, the owner's address is in California

[achtungpv]

Originally Posted by Torontonian

I checked couple of the houses for sale, they are empty, the owner's address is in California

A lot of property in the NW burbs was purchased as investment property. A year ago, a friend was outbid on 4 different houses in Steiner and another subdivision (don't remember which one) all by investors from CA before she finally got a house in Steiner. One of the subdivision sales agents said 4 of 5 homes he was selling were to Californians and half of those were investors.

[austin-steve]

I run market stats for Austin each month, in a slightly different way than the Board of Realtors reports. Each quarter I do a breakout by MLS Area, which is attached.

But below is the narative from the blog article. I don't know how to post all the html charts and graphs to the forum or I'd do that, but there is one graph below and a pdf file you can view to see area breakouts.

Look at the stats and interpret them as you will.

The Austin real estate market is a set of markets within a market. Trying to describe what’s going on is like trying to say what the weather is like right now in the U.S.

What is true in one area often does not apply to another. Overall in Austin, the number of sales have dropped, and the inventory has risen, yet the prices overall are rising steadily in most areas, and the Days on Market for homes sold remains very good.

For September, Average Sales Price is up 11% over September last year. Median Sales Price is up 9% over last year. Days on market is 58 days and median days on market is 37 days.

Year to date, average sold prices are up 7%, and both average and median days on market have fallen (which is good). When I remove Builder homes (new homes) from the YTD stats, the median days on market drops to 28, which is fantastic and amazing.

That means half of all resale homes sold through the Austin MLS this year sold in 28 days or less, and probably for a higher price than the home would have sold for a year ago. For those sellers, this is a superb outcome to their sales effort, and they would personally report a much different real estate market than the one we read about, given their quick sale.

So, for many sellers and agents, the gloom and doom we read about in the newspaper and hear on the news simply doesn’t show up in their particular sales effort in Austin TX.

On the other hand, a rising level of inventory combined with fewer sales does mean something. And it can’t be dismissed. If that continues, I would expect to see the other stats, which remain good, to eventually shift. As listing agents, we assume the shift has already taken place and advise sellers accordingly. As buyer agents, we think buyers can be a bit more agressive than they could have during the summer. We are in fact in a shifting market and it may be that the stats are lagging. Nevertheless, many areas of Austin are not feeling this shift at all yet.

Below you will find the usual stats I post each month plus the Area Breakdown that I normally do each quarter. Here is a summary:

Of the 42 Austin MLS Areas tracked on the breakout chart below, 22 have better than 9% price appreciation YTD over last year.
Of those 22 areas with better than 9% appreciation, 7 have better than 15% appreciation YTD over last year.

Of the 42 Austin MLS Areas tracked, 8 have less than 5% appreciation.
Of those 8 areas, 2 have negative appreciation, Manor (MA) and far East Austin (5E). Both areas with many new starter homes.

Of the 42 areas, 24 (57%) have fewer sales this year than last, but many have much higher sales volume.

Area RN (Steiner Ranch, River Place), for example, has seen almost 40% more homes sold that the same period a year ago, and still has 10% avg and med price appreciation, though days on market is high at 84, and I know that some homes are sitting unsold.

Area 3, in close-in northeast Austin, has 51% fewer homes sold this year compared to last, and the average prices of the homes in that area are up 16%. So there is not necessarily an automatic correlation between the number of sales and the performance of the market.

Area 8E (Eastern part of Westlake/Eanes Schools) is the most expensive area of Austin with an average sales price of $918,694, which is a 16% increase over the same period last year and 4% fewer sales.

The least expensive area is far East Austin (5E), with an average sales price of $110,144, which is a 3.18% decline over the average sales price during the same period a year ago, and 12% fewer sales.

In short, the market is mixed and one cannot draw conclusions from one piece of data or the stuff you read in the newspaper or watch on the national news without looking at it in the context of other LOCAL information.

[LinusK]

Thanks for the update, Steve. I thought the sold vs. expired listings chart on your site was esp. interesting.

[FromCalitoSteinerRanch]

Originally Posted by FromCalitoSteinerRanch

I guess I would like to know how many are closing each month. It is it 10 homes a month, then I will be curious why, but if it's 30 homes a month, then that is still less that 6 months inventory, assuming nothing is added each month...

I will use straight line calculations from the stats posted by Austin-Steve (thanks!). For this year, the avg. number of homes sold in RN MLS area with the above caveat is about 72 a month. With 178 homes available in Steiner, then that is about 2.47 months of inventory in the neigborhood. Of course I used the simplest math, and that assumes that all 72 sales a month are in SR, and none in River Place, but still like those numbers even if it is 3-4 months inventory in SR.

[carlym]

Some personal info..my daughter just listed her house in South Austin. The Realtor told her if you want to sell fast (under 30 days) we have to price right. She said "your house is great, new a/c, appliances, water heater, concrete floors etc. But, it needs a new roof and fence. If we ask for more they'll nickle & dime you to death". So since she wants to sell fast (job transfer) asking is 10,000 less than she expected. But it makes sense. We'll see what happens. Even on this site we hear how "great" the house is untill after the sale, then we hear of bad points.

[LinusK]

The number of home sales in Austin declined in each of the last four months. In Sept., sales fell by 23% from Sept. of last year. The months inventory has climbed from 3.1 in Jan., to 4.7 in Sept. There are currently more homes for sale in Austin then there have ever been. The median price also declined from $190,800 in Aug. to $182,900 in Sept.