Happy New Year!!
The new year is a great time to reset and take time to forecast on the events to come. We make it part of our service to you to always stay on top of what is happening in Austin real estate and to look forward for what's coming up.
Here are our 3 Big Predictions for the Austin real estate market in 2017.
1. Fewer Austin homes will be sold
The trend that we're seeing is that the number of homes being sold in Austin is decreasing slightly. For the year, 2016 saw 0.3% more homes sold than in the prior year. The 4th quarter saw a decrease from the year prior. The signs point to fewer sales for this year.
From what we see, buyers are being more selective and forcing homes to meet value expectations. This shift causes some homes to sit on the market for longer and reduce their price to make up for the value perception. According to Realtor statistics, Austin is in the top 10 markets for home price reductions in the country.
It's critical that home sellers show the value of their homes to potential buyers. Our specialty is to work with our sellers to ensure that value of their beautiful homes shine through! We give our clients the best opportunity to hit their goals. In fact, our homes sold for 2.5% higher than the average home sale and our homes sold in an average of less than 15 days, which beats the market by nearly one month!
2. Property values in Austin will increase
Even though the number of homes being sold is showing signs of decreasing, the home prices are increasing. The median sales price in Austin was up over 8% in 2016 and December was the highest median price of the year at $375K in Austin.
Most home owners have a good bit of equity in their homes. The Austin market has seen the most amount of appreciation in the past 10 year of any large market in the country.
Average days on market is the key metric to determine if you're in a "buyer's market" or seller's market." We're still in a seller's market - with less than 3 months of inventory for sale - and it's doubtful that we'll fully shift into a buyer's market this year. Typically, home values increase in a seller's market and we believe this trend will hold true in 2017. Maybe just not as much as in previous years.
3. Interest rates will increase
The FED increased interest rates a little over a month ago, which is a sign of market confidence. Look for rates to increase in 2017. Experts predict that rates could increase 3 different times in this year.
No need to panic, though. The increases are most likely to be nominal, as the recent increases have been, and not price buyers out of the market. Yet, buying a home earlier in the year is your best bet to get the lowest interest rate possible.
Here's to a wonderful 2017!!