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Happy new year and welcome to the new decade! Are you excited as we are? Austin has been booming for a few years now and it’s looking to continue this upward trajectory. We’ll take a deep dive into how Austin’s growth into Silicon Hills with tech companies like Apple, Vrbo, Facebook and more continuing to open up more offices in our city is affecting our housing market.
1. Housing Market Will Remain Strong throughout the first three quarters.
There were 39,495 sales in 2019 which was a 6.2% increase from the previous year with a total dollar volume increase of 21% from the previous year. We’re expecting to maintain the same moment or see a slight increase.
2. Continued job and population growth means an increase in home sales/rentals
There were 39,000+ new jobs in Austin in 2019 and we are predicting a similar number for 2020. Why does this matter? Historically, for every job you have, there is a multiplying factor of 2.5 to 3 people more here for that one job. Job growth equals increased home sales/rentals and better commerce at retail, restaurants, etc.
“Austin’s GDP,* which grew 117% over the last 20 years, helped the real estate market recover from the recession,” Mark Sprague, State Director of Information Capital at Independence Title, said. “The closest metro out of the top 50 in the U.S. to see this type of growth was Silicon Valley, which grew its GDP by 99% during the same period.”
*Gross Domestic Product (GDP) measures the growth of jobs and the productivity of those employed.
3. Interest rates remain low.
Currently 30 year fixed rated are 3.5-3.75%. Every time rates go up 1%, consumer loses 12% of buying power so it’s still an amazing time to buy.
4. Inventory still low.
While the demand may be high, 2019 showed 1.7 months of inventory whereas a balanced market is just above 6.5 months of inventory – which makes this a great time to sell. However, if you’re a buyer, it means a lot more competition. We usually advise to put a strategic plan together so you’re ready when the perfect home comes along.
Curious on how your home’s value is growing and looking to move into another home this year? Let’s set up a call to chat more!