Current Austin Market

Overall the Austin real estate market is doing very well. The national news paints a pretty rough housing picture, but Austin and Texas as a whole seem to be exempt. We didn't see the huge appreciation that other areas of the country did over the last few years. Our growth was much steadier which is why we're still seeing good appreciation today.

In August the average price went up but sales volume was down. Two forces are pushing both of these indicators. First, the tightening of the lending market on out-of-the-box financing has removed some potential buyers from the market, mainly buyers that could only qualify under subprime guidelines and investors relying on low downpayment loans. Both types of buyers typically purchase at the low end of the market.

Second, as homes appreciate there are fewer numbers of homes for sale at the price range at the bottom of the market. But when sales are tallied for that low price range they are lower than the previous year.

The mid market sales volume saw an increase of 3% over August 2006, and sales over $400,000 saw an increase of almost 10%. Buyers in these ranges aren't typically reliant upon out-of-the-box financing and are usually buying their primary residence so aren't affected by the credit tightening.

So fewer lower priced homes are selling, while the mid range and higher are still selling, bringing the average price up, even though overall volume is down. These mid range buyers, with their secure financing options, are driving the Austin market and will continue to steadily push appreciation.