AUSTIN-AREA HOUSE MAR­KET SHOWS SIGNS OF STA­BI­LIZ­ING

Sales up 0.9% over same month in 2016, small­est Fe­bru­ary rise since ’09.

Austin American-Statesman - - FRONT PAGE - By Shonda No­vak sno­vak@states­man.com Home sales con­tin­ued on B7

Cen­tral Texas homes sales re­treated in Fe­bru­ary, with sales in­creas­ing less than 1 per­cent yearover-year, the lat­est fig­ures show.

The me­dian price for the metro area, how­ever, climbed 6.5 per­cent, to $287,000, the Austin Board of Real­tors said in its monthly re­port Thurs­day.

Within Austin’s city lim­its, sales rose 6.4 per­cent over Fe­bru­ary 2016, the board’s fig­ures show. The me­dian sales price in Austin was flat year-over-year, with half of the homes sell­ing for less than $330,000 and half for more.

Over­all in the Austin metro area — which spans from Ge­orge­town to San Mar­cos — sales were ba­si­cally flat, ris­ing only 0.9 per­cent, the board said. That was the small­est gain for Fe­bru­ary since 2009, when sales plunged 29 per­cent year-over-year amid the na­tional hous­ing cri­sis.

Board of­fi­cials said Fe­bru­ary’s flat sales — 1,829 in to­tal — in­di­cate the Cen­tral Texas hous­ing mar­ket is be­gin­ning to sta­bi­lize.

“The Cen­tral Texas hous­ing mar­ket is just now be­gin­ning to catch up to it­self after years of un­prece­dented sales growth,” Brandy Guthrie, pres­i­dent of the Austin Board of Real­tors, said in a writ­ten state­ment. “It’s im­por­tant to re­mem­ber that cur­rent fig­ures are be­ing com­pared to very strong hous­ing mar­ket ac­tiv­ity in 2016, so a de­cline in home sales growth does not au­to­mat­i­cally mean that the mar­ket is soft­en­ing.”

Mark Sprague, a hous­ing ex­pert with In­de­pen­dence Ti­tle in Austin, agreed.

“Low in­ven­tory lev­els, high home prices and slow­ing job growth across the re­gion are pre­vent­ing a resur­gence of the record-break­ing num­bers ex­pe­ri­enced the last two years, but over­all the re­gion’s hous­ing mar­ket re­mains very strong.”

Sin­gle-fam­ily home sales de­clined from Fe­bru­ary 2016 in

many cities near Austin, with the ex­cep­tions of Buda — up 30 per­cent year-over-year; Cedar Park — up 20.7 per­cent; Le­an­der — up 8.8 per­cent; and the city of Austin.

Austin’s sales growth is be­ing driven mainly by the vol­ume of homes priced $750,000 and higher, Guthrie said.

Even with af­ford­abil­ity an on­go­ing con­cern in the Austin area, where home prices con­tinue to rise faster than in­comes, “so far this dis­par­ity has not slowed the pace of sales,” said hous­ing ex­pert El­don Rude, prin­ci­pal of 360 Real Es­tate An­a­lyt­ics, an Austin-based real es­tate con­sult­ing firm. “What it has done is force buy­ers to make trade-offs re­gard­ing lo­ca­tion, size of home, and the age or con­di­tion of the home they pur­chase.”

Fe­bru­ary’s slower sales could be an in­di­ca­tor of what lo­cal ex­perts have fore­cast — that this year will be an­other strong one for the lo­cal hous­ing mar­ket, through per­haps not as roar­ing as 2016, when sales set a record for the sixth straight year.

“We’ve started off to what looks like will be an­other strong mar­ket, though not as in­sanely ro­bust as years past,” said Austin bro­ker Eric Bram­lett. “The pent-up de­mand from the re­ces­sion years is long gone and builders are fi­nally get­ting more in­ven­tory on the ground, though not enough to keep up with our strong pop­u­la­tion growth. The re­sult is a healthy mar­ket that’s ap­pre­ci­at­ing at a nor­mal 5 per­cent to 7 per­cent rate. Com­par­a­tive to years past, this feels like a slow­down, but we’re re­ally see­ing a re­turn to nor­mal price ap­pre­ci­a­tion that a world-class city like Austin tends to take for granted.”

Tony Trun­gale, a vice pres­i­dent with Re­gions Mort­gage in Austin, said he does not ex­pect this week’s in­ter­est rate hike by the Fed­eral Re­serve to have much im­pact on long-term fixed mort­gage rates.

“These days the Fed chair an­nounces their plans to raise rates far enough in ad­vance that the mort­gage mar­ket has al­ready ad­justed up­wards by the time of the ac­tual ad­just­ment ac­tu­ally hap­pens,” Trun­gale said.

Rude said the Texas Work­force Com­mis­sion’s re­vised 2016 job growth num­bers last week are the main rea­son he re­mains bullish on the lo­cal hous­ing mar­ket. The new fig­ures show the re­gion added over 32,000 jobs, a 3.3 per­cent growth rate, in­stead of the a 1.9 per- cent rate ini­tially re­ported.

Carol Dochen, an Austin real es­tate bro­ker, said the spring mar­ket “is prov­ing to be just a ro­bust as last year.”

“You will see lots of homes com­ing on the mar­ket dur­ing these next few months and I am sure the mar­ket will con­tinue to in­crease in price,” Dochen said. “In the last seven days, the Austin Board of Real­tors re­ports that 958 homes came on the mar­ket and 1,007 went pend­ing dur­ing the same pe­riod and 664 closed — all in one week.”

In the Drip­ping Springs area west of Austin, Free­hold Com­mu­ni­ties said 50 to 60 prospects a week, on av­er­age, are vis­it­ing the model homes at its new Head­wa­ters sub­di­vi­sion. Once com­pleted in seven to eight years, Head­wa­ters will have 1,000 homes and more than 1,000 acres of open space.

Cur­rently, 26 homes are com­pleted or un­der con­struc­tion, with the first res­i­dents due to move in next Thurs­day. Prices range from the high $300,000’s to over $700,000.

“Net mi­gra­tion counts lead us to be­lieve that strong de­mand for hous­ing in the Austin metro area will con­tinue for the near fu­ture,” said Matt Matthews, Free­hold’s Texas di­vi­sion pres­i­dent.

DEB­O­RAH CAN­NON / AMER­I­CAN-STATES­MAN

New homes were for sale in Fe­bru­ary on West 33rd Street in the Her­itage neigh­bor­hood. Austin Board of Real­tors of­fi­cials said Fe­bru­ary’s flat home sales — 1,829 in to­tal — in the re­gion in­di­cate that the Cen­tral Texas hous­ing mar­ket is be­gin­ning to sta­bi­lize.

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