Austin, the Texas city with the greatest real estate market crisis

Nick Gerli, CEO of the real estate data platform Reventure App, said in a statement that the city of Austin has become the “ground zero” of the Texas real estate market, a market that was once thriving.

In a post shared on X, Gerli highlighted that property values in Austin had fallen by almost 20 percent from their peak during the pandemic era, due to decreased demand while the number of available homes increased, reaching more than 10,000 properties for sale compared to 7,000 before the pandemic.

According to data from the United States Census Bureau, between the years 2000 and 2022, Austin was the main point of a large migratory wave that brought millions of people to Texas, a state that received a little over 9 million new residents attracted by the state’s affordable housing, relatively strong job market, absence of income taxes, warm climate, and lower cost of living. For example, in the year 2022 alone, Texas’s population grew by 470,708 people.

The influx of so many newcomers to Texas, combined with a historically widespread housing inventory shortage both nationally and statewide, significantly drove up housing prices, then the demand for housing in the state began to decrease, mainly because they were no longer as affordable as before.

Simultaneously, Texas began building many new homes to address the state’s inventory gap, and homeowners who had been waiting for better mortgage rates to sell their homes began to do so. This resulted in a sudden increase in inventory both in Austin and Texas as a whole.

In response, Mr. Gerli wrote on X, “Active listings have increased by 25 percent year-over-year and a massive 263 percent from the pandemic low. Texas no longer faces an inventory shortage and now has an oversupply.”

Gerli believes that the significant increase in the inventory of homes for sale in Texas is because home builders and investors “are starting to liquidate this market.” And he says, “investors are struggling to get cash flow due to high property taxes and stagnant rents. Builders need to make substantial discounts to sell homes, which is affecting the resale market.”

Despite the increase in inventory, home prices remain higher in Austin than many can afford. According to the latest data from Redfin, the median home price in Austin was $553,275 in September, an increase of 1.5 percent from the previous year. Statewide, the median home in Texas sold for a median price of $343,800 in the same month, a reduction of 0.44 percent from the previous year.

Available Foreclosures:

Austin: 1,200 homes available

Dallas: 950 homes available

San Antonio: 870 homes available

By Elías DaSilva | 22 de Noviembre de 2024.