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By Michelle Pitcher – Austin Business Journal

Austin isn’t the only metro in the Lone Star State in the middle of a housing frenzy.

In fact, prices are going up across the entire state, with the four largest metro areas seeing at least 15% increases year over year. Statewide, home prices went up 19.1% between Q2 of 2020 and Q2 of 2021, according to data from Texas Realtors.

Still, Austin wears the heaviest crown, with both the highest median home price and the largest increase year-over-year.

Median Housing Price in Q2 of 2021

Austin outstrips the Texas median home price by more than $100,000.

The statewide median home price is $300,490, and nearly a third of homes in Texas sold for between $200,000 and $299,000 over the course of the year.

Much rarer were homes listed between $400,000 and $499,000 — homes at these price points made up only 11.6% of houses sold. In the Austin metro, however, the median house is at the higher end of that range, coming in at $482,364 in June, according to the Austin Board of Realtors.

These price spikes are not solely because of the pandemic, experts said. In fact, home prices have been rising in Texas for years.

Since 2012, home prices across Texas have been increasing between 4% and 10% per year, according to Texas Realtors Chairman Marvin Jolly. In early 2020, demand was already high and inventory was already low, even before the COVID-19 pandemic rocked the market.

Austin’s role at the front of the pack, however, is a relatively new phenomenon, Jolly said. For the last 10 years or so, he said the Austin housing market has been performing exceptionally well.

How much have home prices gone up in a year?

Austin experienced the largest increase in median home prices since Q2 2020.

While the Austin housing market showed signs of growing in the early 2000s, the “Austin Boom” began in earnest around 2012. According to Jolly, Austin came out of the recession “faster, stronger and higher” than other Texas metros.

He said the residential real estate market is driven by three fundamentals: job growth, housing affordability and interest rates. Over the last decade, the Austin metro has consistently performed well even with recent housing affordability struggles.

Experts continue to say this is a historic and sustainable reset of housing prices as Austin shifts from a mid-tier city to a tier one metro area, economically.

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Sairam Kota

Sairam is an experienced multifamily deal sponsor and asset manager for 738 units, a key principal in 332 units and limited partner in 1000 units. He has a strong experience in asset management, property reposition, income generation, implementing operational efficiencies and cost reduction. Sairam is a licensed Real Estate Broker in the state of Texas. He is a successful IT Consultant with 20+ years of experience in corporate America.