It’s no secret that Austin home prices are higher than comparable homes in other Texas cities, and that sounds like great news if you want to sell a home in this area. Buyers here must be willing to pay more than those in other cities so they can live, work and enjoy the most vibrant and interesting city in Texas, right?
But are home prices now rising so high that it’s impossible to sell a home at the current market value?
You Could Get Lucky
For some buyers, there’s no such thing as too much to pay. That’s because the price a buyer is willing to pay sometimes depends more on subjective personal criteria than on objective financial information. Some buyers may find your home absolutely perfect for them and be willing to pay as much as necessary to acquire it.
The right buyer might be willing to outbid three or four other buyers because of your home’s easy access to Mopac, its proximity to their new employer or the funky vibe of your close-in neighborhood. If you find a buyer like that, house price trends and market analyses don’t matter. You’ll sell high, and everyone will be satisfied.
Some buyers are willing to put a little more money at risk on a house that could decline in value or at least fail to increase in value so they can have the right home — if their mortgage lenders will let them. But how many buyers are there like that? And how likely is it you’ll get connected with one?
The Issue Of Affordability
There are a number of positive economic signs working to bring up housing prices in Travis County, including new employers coming into the area and a still-inadequate supply of existing homes for sale. This upward trend has been happening to some degree since the city first started its recovery from the economic downturn, but the market has shown particular strength in the last year.
In some cities around the country, there’s an issue with house prices rising more quickly than income levels. This declining affordability of homes is actually a positive sign for the economy in many ways, but it means fewer people are in a position to afford each house on the market, and that means fewer offers and more homes going unsold. This will inevitable lead to lower home prices in these areas in the long run.
But that’s not what we’re seeing in Austin. This is a growing city with lots of people moving to the area and a relatively limited supply of homes on the market. That means each home may get multiple bids, driving prices up.
It’s A Confusing Market
If you’re selling a home in Austin today, the market may be confusing to you. That’s because it’s an improving market. Some statistics indicate that home prices in the area are more comparable to those in other Texas cities than most think, but there’s still a perception that Austin home prices are too high.
Additionally, it isn’t known exactly how money those new employees who are moving to the area for jobs that haven’t been created yet will make, so you can’t be sure how much they can afford.
But this much is certain: Your Austin home is worth more today than it was even a year ago. And to those homebuyers who really like it, it’s worth even more than that. Just be aware there’s a danger of overpricing your home for this still-recovering market, and be willing to come down if you don’t get a bite right away.
- Home Prices Up at Fastest Pace Since ’06 (abcnews.go.com)
- Lack of homes sees housing prices rise (wwlp.com)
- Pricing It Right (teamjeffs.wordpress.com)