Austin-Area MLS: A Detailed Look at Peak and Current Property Values

August 22, 2024 : The "Residential Peak Value Analysis" for both the Austin-Area MLS and the City of Austin presents an insightful overview of how the real estate market has adjusted from its peak periods, providing a detailed examination of various price metrics. This analysis offers a clear comparison between the broader Austin-area MLS and the City of Austin, revealing significant trends that are crucial for understanding current market conditions.

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Austin-Area MLS Overview :

The data for the Austin-Area MLS indicates that the peak values in various metrics were reached between April 2022 and April 2024. The most recent peak in average list price occurred in April 2024 at $712,290, but since then, it has dropped by 10.0%, settling at $641,130. This decline is echoed across other key metrics, such as median list price, average sold price, and median sold price, which all saw their peaks in May 2022. Specifically, the median sold price experienced the most significant drop, falling by 19.8% from $538,000 to $431,683. Similarly, the average sold price per square foot decreased by 17.9%, and the median sold price per square foot declined by 18.6%.
These trends indicate a market correction that began in mid-2022, suggesting that the rapid appreciation observed in prior years was unsustainable. The data highlights a cooling period where sellers are adjusting their expectations, and buyers are responding to changing market dynamics, possibly influenced by factors such as rising interest rates, economic uncertainties, or shifts in housing demand.

City of Austin Overview: 

The City of Austin, while experiencing a similar trajectory, displays slightly different nuances compared to the broader Austin-Area MLS. For instance, the peak average list price for the City of Austin was recorded in April 2024 at $951,762. This price has since declined by 6.7%, reaching $888,107. The decline in the City of Austin's median sold price, which peaked at $680,000 in May 2022, is notable at 15.4%, bringing the current median sold price to $575,000.
The per-square-foot prices in the City of Austin also mirror the broader MLS trends, with an 18.8% drop in the median sold price per square foot from its peak in April 2022. The average sold price per square foot saw a decline of 17.9% since May 2022. These figures suggest that while the City of Austin continues to command higher absolute prices compared to the broader Austin area, it is not immune to the market's cooling trends.

Comparative Insights : 

When comparing the Austin-Area MLS with the City of Austin, a few key differences emerge. The City of Austin generally experienced higher peak prices and subsequently smaller percentage declines compared to the Austin-Area MLS. For example, the drop in the average list price from the peak was 6.7% in the City of Austin, compared to 10.0% in the Austin-Area MLS. However, the City of Austin's median sold price per square foot experienced a slightly larger decline (18.8%) compared to the broader area's 18.6%, suggesting a more significant correction in the valuation of properties on a per-square-foot basis within the city.

Market Implications: 

The data from this analysis underscores the importance of understanding both the macro trends across the broader Austin market and the micro trends within the City of Austin. For sellers, this means adjusting expectations to align with current market conditions, while buyers may find opportunities in this market correction phase. The considerable drops from peak values, particularly in sold prices, could signal a more buyer-friendly environment, depending on individual circumstances and market segments.

Overall, this analysis paints a picture of a market that has retreated from its peak exuberance, moving toward a more balanced state where both buyers and sellers need to navigate carefully.