From the cover
The rise of ‘accidental landlords’ in Austin
The approach
The overview
Realtor Carol Dochen with Dochen Realty Group said the market remains a buyer’s market, with buyers holding more leverage as their options grow. Months of inventory measures how long it would take the amount of homes on the market to sell, with six representing a balanced market, according to the National Association of Realtors. In June, MOI in Northwest Austin was 5.5, its highest in over five years, Unlock MLS data shows. Even so, although home prices are generally lower, some areas have experienced median home sales price increases. Of the 28 homes sold in ZIP code 78750 in May, for example, the median home sales price was almost 75% higher this year com- pared to the previous year, according to Unlock MLS data. “[Inventory] has gone up across the board in all markets. ... That doesn’t necessarily mean the price will go down,” Neuren said.
original listing price to secure homes, Unlock MLS data shows. As the housing market has cooled off, homeowners are struggling to earn their money back, said Renee Livsey, Northwest Austin sales and leasing manager for JBGoodwin Realtors. “Anyone that bought in 2021-22 and that are trying to sell now, I’ve seen people losing money on it,” Livsey said. The amount of homes for lease is increasing, Katie Dochen said, resulting in a lot more variety for renters to choose from. “We’ve had several situations where we haven’t been able to get a good enough price for our sellers to sell, and then we put it on the rental market and we’ve leased it out very quickly,” said Realtor Lindsay Neuren with Compass Real Estate.
As the local real estate market shows signs of slowing, Unlock MLS data shows homes are generally spending more time on the market and home prices are coming back down in the Northwest Austin area on average. For homeowners looking to sell, however, this has created a new trend in Austin, with more sellers turning to leasing as they wait for the market to bounce back, Dochen Realty Group Realtor Katie Dochen said. “We have a lot of what we’re calling ‘accidental landlords’; people who have this minimum price they could possibly take and they can’t get that price,” Katie Dochen said. “If you can’t sell for less than that ... then you’re going to have to rent it out.” When the local market was at an all-time high in 2021, many homebuyers offered more than the
June closing prices
Median home prices in June
Closing price vs. original list price Closing prices have been lower than original listing prices in Northwest Austin since 2021.
The median home sales price in June reached a five-year low for Northwest Austin, data shows.
Months of inventory in Northwest Austin has increased in the past four years in June. Northwest Austin inventory in June
$800K
110% 120% 100%
110.1%
Months
$600K
5.5
99.1%
6
96% 95.8%
$400K
103.4%
3.8
4.5
99.1%
3.3
90% 80% 0%
94.9%
$200K
3
1.9
1.2 0.9
$0
1.5
0.5
0
SOURCE: UNLOCK MLS/COMMUNITY IMPACT
SOURCE: UNLOCK MLS/COMMUNITY IMPACT
Zooming out
The decline in the number of home sales is in line with national trends right now and is an impact of uncertainty in the market, Carol Dochen said. “No matter what price, no matter what location, I think people are just a little hesitant now,” Carol Dochen said. One reason behind this is interest rates, Livsey said. Data from Freddie Mac shows 30-year mort- gage interest rates rose from 3.82% in the first week of June 2019 to 6.85% the first week of this June. Other possible reasons are the current economic state of the U.S. and ongoing issues in Washington, multiple Realtors said.
Homes sold in June
300
10%
Across the Northwest Austin market, the number of homes sold in June was less than half those sold at the height of the market in 2021.
6.79% 6.85%
240
8%
5.09%
180
6%
6.99%
3.82%
Number of homes sold
3.18% 2.99%
120
4%
30-year fixed mortgage interest rate (first week of June)
60
2%
0
0%
SOURCES: UNLOCK MLS, FREDDIE MAC/COMMUNITY IMPACT
20
COMMUNITYIMPACT.COM
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