Individuals looking to buy or sell a home in Austin will find the market is soaring. Demand remains high while the supply is extremely limited. This has led to a drastic increase in prices and buyers feel the pain. Furthermore, major businesses continue to relocate to the area, which puts a further burden on the housing supply. These factors have led to a competitive market, one that is expected to continue for the coming year.

The Effects of the Pandemic

The pandemic hit many parts of the country hard, but Austin remains unscathed. In fact, businesses in the city added over 11,000 jobs in 2020 and home sales were higher than seen in 2019. Although residential sales did drop in the early spring when the pandemic first hit, this dip didn't last long. Over 40,000 homes sold accounting for $17,579,802503 in sales volume. This serves as a symbol of housing prices and sales activity, according to an Austin Real Estate Lawyer, and sales broke a record that year.

Experts wonder what sales would have been like if the pandemic never hit. Home sales declined during that period due to a lack of housing inventory. Sellers chose to back out of their contracts as a result of the uncertainty surrounding the pandemic and health crises. However, at the same time, more people were choosing to move to the city thanks to the new work-at-home culture.

The Role of Businesses in the Housing Boom

Many companies are choosing to relocate to Austin. Tesla and Google serve as two good examples of major corporations now choosing to call this city home. Oracle is another major player choosing to move its headquarters to the area, and all come with countless employees in need of housing. Texas continues to create new jobs, which leads experts to believe the housing market crunch won't be resolved any time soon.

A Seller's Market

New listings lag significantly behind pending sales in the Austin area. Homes sell so fast that new listings simply cannot keep up. In fact, homes in the Austin metropolitan statistical area (MSA) sell 25 days faster than one year ago. Home sales within the city of Austin also broke a record last year, with sales increasing by 1.7 percent to 12,745. The sales dollar volume increased to $6,746,602,345, a jump of 16.3 percent.

Why Is This Important?

With home prices growing by the double digits, the Austin housing market is in desperate need of more housing supply. No price point remains unaffected by the crunch, and the only way home price growth will stabilize this year is if the housing supply increases. At this time, the months of supply have fallen to 0.6 months. This means the current market supply will fall to zero in only five weeks if the pace of sales continues at the current rate.

Individuals looking to purchase a home in the Austin area will find it difficult to do so. On the other hand, sellers find now is the time to list their property on the market. They could find buyers in a bidding war, which tends to drive the price up. Fortunately, people looking to sell don't need to do so immediately. Buyers, in contrast, need to put in an offer on a home they love immediately. A failure to do so could mean they miss out and won't find another suitable home for an extended period. Everyone must know the market to make an informed decision regarding their future. For this reason, keep up with any changes that are occurring so you don't miss out.