Austin Home Sales Increased During The Month Of May

The Austin Board of Realtors reports that home sales in the Austin area continued to increase in May. In fact, they rose by 24% when compared to May of 2009. Of course, home sales at this time were still receiving a nice boost from the federal new homebuyers tax credit, so everyone has been anxiously looking forward to see what the future might hold.

"Although the tax credit expired in April, we are still seeing its impact on sales in May," said John Horton, who is the chairman of the Austin Board of Realtors. "Single-family sales continued to exceed last year's numbers due to home contracts written before the April deadline, which continued to close in May."

In May of 2010, the median price of homes in the capital city feel by 2% when compared to May of 2009, at which time the median price was $192,000. The figures are up, however, when compared to April 2010, at which time the median price was $190,700. In all, home sales for the month of May totaled $508 million, with a total of 2,074 homes being sold. The number of days single family homes stayed on the market also fell to 63 days, which represents a 20% decrease when compared to May of 2009. On the other hand the number of pending sales also feel when compared to May of 2009.

"The rush of buyers to beat the homebuyer tax credit in April led to a decrease of buyers in the market in May, resulting in decreased pending sales," continued Horton. "However, the market in Austin continues to maintain a balanced supply of housing inventory, which is currently at 6.7 months. Sustaining a healthy supply of inventory should help prices continue to remain stable in the coming months."

Interestingly, condo and townhome sales seemed to follow the same pattern as single-family homes, with the sales of these properties increasing by 28% for a total of 226 sales. Pending sales, on the other hand, fell to 167, representing a 28% decrease.

Overall, housing sales figures have been up for most of the year in the capital city, though Horton does predict that the market will see a slowdown during the summer. This is largely because he believes those who wanted to purchase a home rushed in order to take advantage of the credit, while those who were on the fence will now be taking their time in their searches since they already missed the deadline.

"Due to many buyers moving their decision to purchase up to beat the tax credit deadline, we could see a slight decrease in sales in coming months," said Horton. "Despite the potential slowdown in sales, we will continue to see April contracts close during this time. It is natural to have a pause in the market before new buyers enter for the summer buying season, and we expect the market to even out by the end of the summer."

Despite the expected lull in the market, Texas Realtors may see a bit of a reprise thanks to the Bond 77 program. Launched by the Texas Department of Housing and Community Affairs last month, the program is part of the state's first-time homebuyer program. Through the program, the department is supplying $500 million to eligible homebuyers who may need mortgage loan assistance, whether they need help with making their down payment or with obtaining a lower interest rate.

"It's the single-largest financing initiative for state homebuyer funds in the 27-year history of the program and serves as the state's response to the recent expiration of the federal homebuyer tax credit," said Gordon Anderson, who is a spokesman for the Department of Housing and Community Affairs.
The first $50 million of the allocated $500 million is now available and will be distributed on a first-come-first-served basis. Overall, the state anticipates making the funds available over an 18 month period.