Austin American-Statesman writes, "new housing developments continue to spread across Central Texas, but experts say more homes are still needed to keep pace with demand.
"The Austin new home market overall was steady the last half of the year," said Ben Caballero, CEO of HomesUSA.com. a real estate agent and CEO of Dallas-based HomesUSA.com. “As we head into the holiday season and start the new year, we have the Texas advantage on our side, as we continue to attract large employers. This relocation means a continuing need for more homes, and Austin builders are doing their best to create more inventory."
Caballero said the new-home market in the Austin region is poised for growth, if what many leading economists are predicting comes true – that mortgage rates improve in 2024.
"We should see new home sales growing next year from current levels,” Caballero said.
Good news came early in 2023 as builders posted strong sales the first five to six months of the year, said Eldon Rude, a longtime housing market analyst.
"The resale market played a major role in the strong market to start the year as many would-be home sellers with sub 4% mortgages elected to stay put rather than selling and taking on a much higher interest rate," said Rude, principal of Austin-based consulting firm 360° Real Estate Analytics.
"Unfortunately, surprises were once again in store for the market as interest rates escalated sharply again during the summer, hitting a high of nearly 8% by October," Rude said. "The result, of course, was buyers pulling back. As we move deeper into December, rates have decreased slightly, which has certainly spurred more sales activity for many builders."
Here's a look at some of the new-home communities that are in various stages of development, with some having recently started and others due to launch, or ramp up, in 2024, according to Rude and Zonda, which also tracks the Austin-area housing market.
- Nolina — a master-planned community on Ronald Reagan Boulevard, west of RM 2338 and slated to have more than 1,000 lots.
- Lariat in Liberty Hill — 1,020 lots.
- Trinity Ranch — 879 lots in Elgin.
- Mirador — 3,252 lots in the Del Valle area in southeastern Travis County.
- Prairie Lakes — 2,200 lots on the east side of Buda.
- Waterstone — Ultimately planned for just over 10,300 lots in Kyle
- Rancho San Gabriel and Woodland Preserve, both in Georgetown, ultimately planned for 1,465 lots and 1,003 lots, respectively.
New-home sales, prices down month-over-month
The 3-month moving average of new home sales was lower in November, slipping to 808 sales compared with 819 in October, according to Caballero's HomesUSA.com.
The overall new-home price in the Austin market also fell in November from October. Seasonal factors and stubbornly high interest rates drove the average 3-month new home price lower in all four of the largest new-home markets in Texas, Caballero said.
In the Austin metro, November’s 3-month moving average new home price was $500,831 compared with $524,400 in October, Caballero said.
Bryan Glasshagel, a senior vice president with Zonda, said 2024 will be an interesting year for the Austin-Round Rock region.
- "It should be one of transition for the Austin MSA," Glasshagel said. "New home starts should stabilize and increase from the lows of 2023, similar to what we have already seen in other Texas markets like Dallas and Houston."
- "Builders will benefit from rates moving lower as this should enhance consumer confidence and lessen the level, and cost, of mortgage rate buydown incentives."
- "As demand strengthens, lot and home supply levels will likely tighten. While potentially not a 2024 event, long-term this will put upward pressure once again on pricing.""
Source: Austin American-Statesman
Written by: Shonda Novak
Published: December 27, 2023
Posted by Grossman & Jones Group on
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