Lake Travis - Westlake Edition | October 2022

TIPPING THE SCALES

A housing market is usually aected by how close a home is to its original listing price when sold and how much inventory is available in a market. Over the last six months, inventory has gone up substantially in Lake Travis-Westlake. In January 2022, inventory was at 0.4 months for the market; now, it is at 3.3 months. An increase of people needing homes in a growing job market contributes to an increase in inventory. Austin currently has the eighth-best performing job market among the top 50 metros.

Current market

A COOLING LAKE TRAVIS-WESTLAKE MARKET For 2022, housing inventory in Lake Travis-Westlake rose from 1.7 months in May to 3.3 months in August.

Seller’s market: Homes in a seller’s market are low in inventory, sell quickly and sell above asking price. The Lake Travis- Westlake market is currently a seller’s market. Balanced market: If no new homes were listed for sale, it would take about six months to sell all the current inventory. Buyer’s market: Homes in a buyer’s market are high in inventory, sell at a slow or reasonable pace and sell at or below asking price.

2021

2022

3.5

3.3

2.8

1.7

1.1

May

June July

August

August May June July

SOURCE: AUSTIN BOARD OF REALTORSCOMMUNITY IMPACT

GROWING AUSTIN JOB MARKET

Growth in job sectors such as information technology have accounted for increased housing demand in the Lake Travis-Westlake area, local Realtors said.

Looking to the future Local experts said people should be prepared for the market to change over the next few months as Austin heads into its busy season. Austin tends to run opposite from other markets, Shiet said. Due to extreme heat temperatures in the summer, people usually start house shopping after Labor Day. As more buyers ood the market, housing prices also continue to go up. In Lake Travis-Westlake, the median residential home price for August sat around $914,000—a 6.6% year-over- year increase, according to ABoR. “Buyers should know that a reces- sion doesn’t mean falling prices,” Contaldi said. “A recession usually just means falling mortgage rates.” Mortgage interest rates, which have continued to decline during the last six recessions, are less than 7% for 30-year and 15-year xed plans. Anything under 7% is historically low, Jones said. In addition to rising prices and falling interest rates, the

considered luxury, according to data provided by Contaldi from Pacaso, a property broker that specializes in owning second homes. Luxury second home ownership continues to be on the rise because those buyers are not tied to a specic location for work and are unaected by rate increases, Contaldi said. As to why people were so interested in moving to the Lake Travis-Westlake area, and Austin in general, the main reason is jobs, Jones, Cary, Contaldi and Shiet said. “Before the pandemic, Austin was growing at a moderate pace,” Shiet said. “The pandemic brought a hous- ing boom we didn’t expect, and peo- ple are ooding into Austin. People realize they can work from home, and they want to be here.” According to the Austin Chamber of Commerce, in the last 12 months, 10 of the 11 major private industry sec- tors added jobs to the Austin metro, including 16,700 to leisure and hospi- tality and 25,300 to professional and business services.

Financial activities 57,000 73,000

2016 2021 Employment by industry

Construction, natural resources & mining 58,800 73,300

Professional & business services 177,200

235,200

Educational & health services 115,600 133,900

Information Technology 29,000 45,100

SOURCE: AUSTIN CHAMBER OF COMMERCE COMMUNITY IMPACT

ability to develop housing quickly will also impact buyers and sellers. As of July, the average total housing development fees charged per unit for a suburban-style development in Austin are 80.4% higher, or more than $8,000 higher, than the average fees for a suburban-style development in the larger Texas metro areas, accord- ing to ABoR. Ination, supply chain issues and government regulation also continue to be setbacks for the housing market, Shiet said. While housing prices, ination, inventory and development issues

will all change the market signi- cantly in the coming year, Contaldi said people do not need to fear the uncertainty of the housing market. “It’s really the sentiments of the consumer that drives the market,” she said. “The best advice I can give to anyone is to do the opposite of what everyone else is doing. When prices are high but interest rates are low, that is the time to buy.”

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LAKE TRAVIS WESTLAKE EDITION • OCTOBER 2022