# Austin Housing Market Report: December 2017, 2017 in Review: The Tax Law Nobody Priced In

> The Austin metro median sale price was $309,000 in December 2017, +6.6% year over year, with homes selling in 54 days and 2.1 months of supply. 2017 in Review: The Tax Law Nobody Priced In, what the numbers mean if you are buying or selling in Austin.

Mike Vilece · January 15, 2018
Canonical page: https://theaustinlocalgroup.com/blog/austin-housing-market-december-2017/

The median Austin-area listing spent **54 days** on the market in December 2017, the longest stretch in this series so far. Active inventory stood at 5,517 listings, up 10.6% year over year. The 30-year fixed averaged 3.95% that month.

## Austin market statistics, December 2017

| Metric | December 2017 |
| --- | --- |
| Median sale price | $309,000 (+6.6% YoY) |
| Median price per sq ft | $144 (+3.7% YoY) |
| Homes sold | 2,602 (+14.1% YoY) |
| New listings | 1,541 |
| Active inventory | 5,517 (+10.6% YoY) |
| Months of supply | 2.1 |
| Median days on market | 54 |
| Sale-to-list ratio | 97.9% |
| Sold above asking | 14.4% |
| Listings with a price cut | 17.4% |
| 30-year fixed rate (avg) | 3.95% |

## 2017 in Review: The Tax Law Nobody Priced In

The Tax Cuts and Jobs Act was signed December 22. The $10,000 SALT cap is the part that matters for Austin: it raised the effective cost of living in high-tax states without raising it here, and the migration data over the following four years reflects that. The year closed with the metro median at $309,000.

## What changed since November 2017

The median rose $14,000 from November 2017, a 4.7% move. Time on market lengthened by 8 days, to 54. Active inventory shrank by 790 listings, to 5,517. The share of homes selling over asking gave up 0.4 points, to 14.4%.

One month is noise. The reason to read it anyway is that direction shows up in inventory and days on market well before it shows up in price, so the months where those two disagree with the headline number are the interesting ones.

## Where this month sits in the cycle

| | December 2017 | November 2017 | December 2016 | Since Oct 2016 |
| --- | --- | --- | --- | --- |
| Median sale price | $309,000 | $295,000 | $290,000 | range $255,626–$314,500 |
| Median days on market | 54 | 46 | 40 | highest since Oct 2016 |
| Active inventory | 5,517 | 6,307 | 4,987 | range 4,660–7,915 |
| Months of supply | 2.1 | 2.9 | 2.2 | range 2.1–3.3 |
| Sold above asking | 14% | 15% | 18% | lowest since Oct 2016 |
| 30-year fixed rate | 3.95% | 3.92% | 4.2% | range 3.44%–4.2% |

The right-hand column is the range this series has covered since October 2016. No forecast in it, just where December 2017 falls against every month that came before it.

## If you are buying in Austin right now

2.1 months of supply is a seller's market, but not a chaotic one. Good homes priced correctly move in the first weekend; anything still sitting after three weeks has a reason, and finding out what it is before you offer is the whole job.

The average home sold for 97.9% of asking, so roughly 2.1% under list was the normal outcome, not an insulting one.

**The payment math.** At $309,000 with 20% down at 3.95%, principal and interest runs about **$1,173 a month**. Add roughly $515 for property taxes and $206 for insurance and you are near **$1,894 a month** all in. Texas has no state income tax and this is where the state collects instead, budget the tax line from day one, not as an afterthought.

**If you are selling:** you have the leverage, and the mistake available to you is overpricing into it anyway. Homes were selling in 54 days. A listing that sits three weeks in this market has told every agent in town that something is wrong, and you will end up taking less than if you had priced it right on day one.

## Neighborhood in focus

**UT Area & Bryker Woods (78703 & 78705).** West Campus, Bryker Woods, Old West Austin. Known for uT-adjacent investment potential. It fits investors and buyers who want to be in the center of everything.

The metro numbers above are an average of a very unequal city, UT Area & Bryker Woods does not move in lockstep with Kyle or Leander, and the gap between ZIPs widens in exactly the months the metro looks calm. There is a longer, more honest write-up at [/neighborhoods/ut-area-bryker-woods/](/neighborhoods/ut-area-bryker-woods/), including what is wrong with it.

## On in Austin, December 2017

| When | What | Why it matters to a listing |
| --- | --- | --- |
| Mid to late December | **Armadillo Christmas Bazaar**, Palmer Events Center | Runs to Christmas Eve at the Palmer. Adds to the Zilker-area congestion the Trail of Lights is already causing. |
| Mid-December | **Trail of Lights**, Zilker Park | Roughly two weeks of nightly closures around Zilker. Barton Springs Road and the 78704 approaches are slow every evening it runs. |

## What is coming next

Amazon's shortlist in January and CodeNEXT draft three in February. And the annual reminder: file your homestead exemption by April 30.

## Common questions

### Is it a good time to buy a house in Austin?

Depends entirely on your timeline. At 2.1 months of supply you are competing, paying up, and giving up contingencies. If you need to be in a house this year, you buy and you accept the terms. If you can wait, understand that you are paying a premium for urgency.

### How much are property taxes in Austin?

Combined city, county, school district and community college rates in the Austin area generally land between about 1.8% and 2.5% of assessed value, and higher inside a Municipal Utility District, where 3%+ is possible. There is no state income tax in Texas, and property tax is the trade. Two things every buyer should do: file a homestead exemption by April 30 of the year after you close, which caps annual taxable value increases at 10%, and check whether your target address sits in a MUD or PID before you finalize your budget.

### What should I know about flooding before buying in Austin?

Central Texas is Flash Flood Alley: thin soil over limestone, steep terrain, and storms that stall. Austin models its own floodplain, which is often stricter than FEMA's, so a house can sit outside the FEMA 100-year map and inside the city's. Standard homeowners insurance does not cover flood, NFIP policies take 30 days to take effect, and plenty of local flooding happens outside mapped floodplains. Pull both maps and get a flood quote during your option period.

### Are Austin home prices going up or down?

Up 6.6% year over year as of December 2017. Austin's price growth in this period is running well ahead of national averages, which is a function of job growth, not of anything unusual about the houses.

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*Part of a retrospective series on the Austin market, one post per month since 2016, compiled from the historical record. This edition covers December 2017; every figure is as reported for that month, and nothing in it looks past it.*

*Source: Redfin Data Center metro market tracker: single-family, Austin-Round Rock-San Marcos metro, not seasonally adjusted. Mortgage rates are the monthly average of the Freddie Mac Primary Mortgage Market Survey 30-year fixed rate. Payment, tax and insurance figures are estimates for illustration and are not a quote. Median sale price is not a guarantee of value for any specific property.*

*Written by Mike Vilece, a licensed Texas real estate agent with Compass in Austin. If you want the version of this that applies to your street and your budget, [ask me directly](/#contact).*

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