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Bill Morris
RE/MAX Capital City
13018 Research Blvd
Austin, TX 78750

Direct or Text: 512-785-3345
Email:              bmorris@remax.net

Texas Broker License # 505218

We take pride in our homes.  For most of us, our home is our largest physical and financial asset.  It's where we spend time with friends and family, where we may go for peace and quiet, and where we spend a lot of our hard-earned money.  It is much more than shelter, more than a residence.  It is "our place," with all the physical, mental, and emotional ties that implies.

Investment real estate shouldn't carry the emotional attachments of a home, but it can be a critical source of income and financial growth.  Financial assets -- stocks, bonds, etc. -- are an important foundation for many investors.  Real estate can provide more stability, current income, and predictable long-term growth.

I represent both buyers and sellers of residential and investment real estate throughout the Austin metropolitan area, which means first-hand market knowledge is brought to bear on serving your needs:

  • My relationship with a home seller begins with a thorough understanding of the client's objectives, needs, and timing. My ongoing analysis of properties and market areas throughout Central Texas provides the basis for a comprehensive analysis of each client's home.  Price consultation, property preparation and staging, and broad promotion of each property follow, and frequent communication -- showing feedback, market updates, and ongoing advice and counsel -- round out a successful listing engagement.  As a starting point, just ask me for a FREE Market Analysis. That may answer your immediate questions, or it could become the basis of a more comprehensive discussion.  That choice is yours.
  • My approach to buyer representation is also full service – shopping, previewing, price and market consultation, contracting, negotiating, coordination of inspections, appraisals, repairs, and closing details, and follow-up beyond the closing of your purchase to ensure your lasting satisfaction.  Looking for a new home?  Use Quick Search or Map Search to browse an up-to-date database of all available properties in the area, or use my Dream Home Finder form and I'll conduct a personalized search for you.

In both roles, honest advice and clear communication are what my clients expect.  The fact that more than 90% of my business is with repeat clients and their referred friends and family is a sign of success in meeting those expectations.  Client ratings that earned my selection for 6 consecutive years as a Five Star Professional -- representing less than 7% of Central Texas agents -- are also very gratifying, and humbling.

As you consider selling or buying Central Texas real estate, you'll find a lot of information on this website that can help.  Much of it is updated regularly, so come back often:

  • National and regional Market Trends is a thorough monthly e-newsletter you'll enjoy.
  • Average Mortgage Rates are up-to-date weekly.
  • As often as time allows, I update My Thoughts ...  on topics that I find important and interesting.
  • You'll also find regular market news on my Facebook and Twitter pages.

You'll find a details About Me and my approach to the practice of the real estate profession, and about why I am proud to be affiliated with RE/MAX and RE/MAX Capital City.

My business and personal experience tell me that service is the key to success and I look forward to serving you.

 

My Thoughts on Central Texas Real Estate

Market Dashboard Update, 3Q 2018

I offered some thoughts yesterday about where we are in the current market cycle.  For a broader view of the Austin-Central Texas residential real estate market, this post will cover my ongoing Market Dashboard, now updated through 3rd Quarter 2018.

First, Trends to Watch commented on listing inventory.  Here’s the big picture since near the end of the last market cycle:

Most market analysts consider 6 to 6 1/2 months’ supply to represent “normal” or “balanced” market conditions.  Notice how long our local market inventory has been at or below half of that level.  Listing inventory in September was 3.0 months, unchanged from August and the same as September 2017.  Seasonal performance looks very much like each year since 2014.

My earlier post also discussed market absorption — i.e., the “odds of selling” for an active listing each month.  For historical perspective, this chart clearly shows how different this market cycle has been from all others in almost 30 years:

The steep decline from 46% to 31% between May and September is noticeable.  As I said earlier, though, one data point is not a trend.  This metric will bear watching in the coming months.

Finally, I wrote previously about the slowing pace of year-over-year price appreciation, but the view of actual average and median prices is important:

Notice that very strong demand has pulled prices upward and above the long-term trendline in recent years, most noticeably since 2015.  Prices have moved closer to the trendline since June, which hasn’t been unusual in recent years, but it is more noticeable and coincides with the decline with the decline in “odds of selling.”  Again, there isn’t enough data here to state with certainty whether this is the beginning of a market transition or just typical seasonality.

Market economists remain confident in our strong market conditions through 2019 and into 2020, and I agree.  Inevitably, however, we will see prices moderate, interest rates increase, “days on market” grow, and inventory will begin to catch up with demand.  I don’t see signs right now of a sharp change but instead anticipate a fairly smooth transition.  Of course, external factors that we don’t know about today could change that, but that’s another post for another time, if needed.

Related news …

Just after I posted Trends to Watch, commenting on changes in the Central Texas real estate market, I found a very good article from Inman in my inbox that covers the national outlook:

Inventory is rising, home prices could flatten in 2019
But don’t expect homes to get cheaper anytime soon with demand remaining high

Strong demand in the Austin area is preventing real inventory build-up, but prices flattening here in the coming year or two may well be a fact.  Our Months’ Supply metric was 3.0 months in September 2018, the same as September 2017 and only slightly higher than 2.8 months in September 2016.  Moreover, all other monthly inventories were consistently lower in 2018 versus the same month in 2017.

There was also a related article in this morning’s Austin American-Statesman:

Austin-area Homebuilding pace slows in third quarter

Home prices in the city of Austin’s are pushing buyers farther and farther into the suburbs, and availability of build-able residential lots and permitting processes in some areas have slowed building starts.

The issues highlighted in both of these articles will remain important in the months to come, and I’ll keep an eye on them.

Thoughts on this Market Cycle – Trends to Watch

On September 26, I posted a complete look at my Market Dashboard and concluded that while the Austin-area market for residential real estate remains badly under-inventoried and fast-paced, we might be seeing some signs of movement in the direction of more normal conditions.  Today I updated that dashboard with final data for September and my opinion is unchanged.  Separately, I’ll provide the primary charts from my dashboard through 3rd Quarter.  For now I’m just ruminating a bit on some subtle changes I saw in the latest data.

Odds of Selling

Much of what I see in the new data isn’t visible in graphs, so I’ll just attempt to describe this change instead.  The “odds of selling” for active listings in September was 31%, down from 38% in August.  That’s still above the long-term average of 25% and slightly above the 30% 10-year average.  What seems unusual is that we reached that level in September.

We saw 30% “odds to sell” in November 2001, on the way down from the huge market peak in the Spring of 2000.  We saw similar conditions in a few months during 2005, 2006, and 2007.  Then came the mortgage debacle, and the odds of an active listing selling stayed near or below 20% from September 2007 until early 2012, when we clearly entered our current very hot market cycle.  Since then, the ONLY times we’ve seen annual dips at or near 30% “odds” were in January of 2013, 2014, 2015, 2016, 2017, and 2018.

That’s 6 months out of 69 that we saw our odds of selling dip to near 30%, and always in January.  So why in September this year?  (For 40 of those 69 months, this metric was at 40% or higher, and it was at or above 50% in 7 months!)  One anomaly doesn’t make a trend, but in conjunction with other changes discussed below it may be meaningful.

Days to Sell

The average time it takes to sell a home continues its slow climb — to 51 days in September compared to 47 in August, and up from 50 days in September 2017.  That’s not noticeable in the fully updated chart, but that is the reported Days on Market stat, and so far in October it’s up to 53 days:

The Pace of Rising Prices

Finally, the pace of year-over-year price appreciation is slowing:

There’s no doubt of the trend in annual price changes since 2013, but compare the slope of our current trend with the last three market cycles.  Moreover, as I have noted before, the economic good news for the Austin metropolitan area remains positive, with unemployment dipping below 3% this month.  This trend does not indicate a cliff ahead.

So what does all this mean?  Maybe nothing, but the odds of selling, time to sell, and upward price pressure are logically linked, and all three of these changes in our market point to a move toward normalization.  This could just be the effect of a very contentious national election cycle, uncertainties about the future of interest rates, or simply the fact that the Austin area has so far been unable to provide enough housing to meet demand, leaving more buyers to search longer, but I’m watching these numbers in an effort to understand the future of our local market in the coming year or two.

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