Austin Unemployment and Austin Real Estate Market Update October 2008
published on November 22, 2008
Austin unemployment inches up in October 2008 to 4.8% while Austin sold prices are flat and the number of homes sold remains low. While this is a seasonally slow time of the year for home sales, the last twenty days has seen much slower sales than the same period of time in 2007, most likely due to the negative feeling people have from the recent and continued stock market decline. However, there are positive signs in the market with the progress the President Elect is making on assigning his new staff members and the federal government is slowly learning what NOT to do with the $700 billion set aside for the bailout. I’m still hopeful that the current economic woes may begin to improve in the Spring. As a result, I continue to recommend selling competitively and buying aggressively throughout the remainder of 2008 and through the first several months of 2009.
The Austin-Round Rock unemployment rate reached 4.8% in October, a rate that was last matched in June 2005. This is the 6th consecutive month of slight increases in the Austin unemployment rate from 3.3% in April 2008 to 4.8% in October 2008, which represents a 31% increase or an increase of 13,100 unemployed. The unemployment rate increased from 4.7% to 4.8% between September and October of 2008, representing an increase of 1,100 unemployed in Austin-Round Rock. A year ago in October of 2007 the unemployment rate was 3.5%, which is 27% lower than what it is today. While unemployment has been on the rise, the labor force has continued to grow by adding 10,045 people between April 2008 and Ocotber 2008 with an increase of 3,614 people between September 2008 and October 2008. The October 2008 Austin unemployment rate of 4.8% is still below the State of Texas unemployment rate of 5.4% and the U.S. unemployment rate of 6.1%. The Austin unemployment rate has now increased 19% between January and October of 2008, which almost matches the State of Texas increase of 20% and beats the U.S. increase of 15%, which shows that Austin’s unemployment woes are still keeping pace with the rest of the state and country. Keep in mind that the Austin unemployment rate is significantly lower than the years following the technology bust when the unemployment rate stayed at around 6% between January 2002 and December 2003. The Austin unemployment rate actually reached its height of 6.7% in June of 2003 before a consistent and steady decline over the following year.
There were 219 Austin homes sold between 11/1/2008 and 11/20/2008, which is 49% less homes sold during this time compared to the 427 homes sold during the same time period during 2007. However, median sold home prices during this time period in 2008 were only .5% less than 2007 ($121.16 per square foot in 2007 compared to $120.49 per square foot in 2008). It is interesting to note that Austin home prices are currently 26% higher than prices were during the market peak of 2000 when the median sold price was $89.71 per square foot. Between 1/1/08 and 11/20/08 there were 7,755 single-family homes sold in Austin (not greater Austin) with a median sold price of $121.41 per square foot ($240,000), 3 bedrooms, 2 bathrooms, 1,923 square feet, and averaging 58 days on the market. This compares to the same time period during 2007 when there were 22% more homes sold and the median sold price was 1.2% less, which equates to 9,901 homes sold with a median sold price of $120 per square foot ($235,000), 3 bedrooms, 2 bathrooms, 1,920 square feet, and averaging 46 days on the market. There are currently 3,838 single-family homes actively for sale in Austin with a median list price of $142.01 per square foot ($315,000), 4 bedrooms, 2 bathrooms, and 2,274 square feet, and averaging 96 days on the market. There are currently 625 single-family homes pending sale in Austin with a median list price of $117.56 per square foot ($225,000), 3 bedrooms, 2 bathrooms, and 1,909 square feet, and averaging 68 days on the market. Notice that the median price and average days on the market are quite a bit lower for homes that are pending compared to those listed for sale – 17% lower median list price per square foot and 29% less days on the market – a good indicator that the more aggressively priced homes are selling and are selling faster than those homes price less competitively. Between 1/1/08 and 11/20/08 there were 3,306 single-family homes withdrawn from the market in Austin with a median list price of $143.52 per square foot ($320,000), 4 bedrooms, 2 bathrooms, 2,268 square feet, and averaging 90 days on the market.
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*Unemployment data provided by the Texas Workforce Commission and raw real estate data provided by the Austin Board of Realtors and interpreted by Austin REALTOR® Brian Talley of Regent Property Group. Although the above information is deemed reliable, it is not guaranteed. The information contained herein is subject to errors, omissions and changes without notice.
Contact Brian Talley at 512-554-9714 if you need help buying or selling a home or if you have a need for Austin office space.
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