In case you don’t happen to be regularly clicking on my About Real Estate page for market updates (or my Facebook page, or otherwise following along), I’m re-posting this EYE-POPPING headline I put up earlier from the most recent Central Texas Housing Market Report put out by the Austin Board of Realtors: in May we reached an ALL-TIME HIGH of $1.2 BILLION (yep, you read that correctly — that’s Billion with a big, fat B) in home sales!
From the report:
“Coupled with rising home prices, this recent surge in home sales activity made May 2017 the highest-grossing month for Central Texas real estate in the region’s history. For the first time this year, single-family home sales dollar volume topped $1 billion ($1,234,217,617) in a single month within the five-county area, which is an increase of 18.4 percent from May 2016.”
(And this figure excludes most new home construction, which is similarly experiencing phenomenal growth. New home construction in Austin is at its highest level since 2007.)
This is obviously very exciting news for sellers. But on the flip side, this trend may be prompting you to ask a very reasonable question: Is this another real estate bubble which might burst in spectacularly messy fashion? We all remember what the country went through less than a decade ago when that housing bubble burst.
So is this another bubble?
The short answer, in my humble opinion, is no. Or at least not in the way it was in 2008-2010; it’s not a bubble created by a whole host of factors which created an artificial inflation of the market, as was the case back then.
The longer answer should include what is a driving force for this increase: job growth. (Or as my broker like to say: Jobs! Jobs! Jobs!) Austin’s current job growth rate of 2.9% puts us in place as the 10th fastest growing major metro area in the country.
As reported in the Austin Jobs Postings Report for May, unemployment is at 3.2% (nationwide we are at 4.3%) and more jobs are coming; several companies have announced expansion plans in the area. To quote from the report:
“The U.S. News & World Report named Austin as the “Best Place to Live in the U.S.” in 2017. Savills calls Austin “one of the 22 Cities at the Forefront of Global Tech” while SmartAsset named Austin as one of the “10 Best Cities to Raise a Family”. Austin also comes in 3rd on Gallups’ “Good Jobs Rate” ranking based on the percentage of adults who work for an employer full-time. Indeed ranked Austin No. 4 on its “25 Best Cities for Job Seekers” list.”
Dang — if I didn’t already live here I’d definitely want to move here after reading all that!
So, summing up: with consumer confidence high, unemployment low, solid job growth and considerable planned expansion coming to the area, I’d say it’s likely that our housing market will remain strong for the foreseeable future. (Barring any big, national economic crash, anyway — OH NO, I hope I didn’t just jinx us!) 😉
And finally, to any buyers sitting on the fence I’d say, “Come on in — the water’s fine!”