As the ‘R’ word Recession is being mentioned in parallel with the COVID-19 pandemic, here’s a few stats that may make you feel better about owning a home in Austin and riding out a potential economic downturn.
- At the peak of the Great Recession, Austin’s median home price fell only 1.16%  – that’s far less than nearly every other market in the country: the rest of Texas (-14%), California (-42%), Washington (-28%), New York (-14%), Florida (-50%) .
- Austin’s median home value has increased every year over the last 30 years with the exception of three years, and these were relative blips on the radar: 2004 (-0.41%), 2009 (-1.16%), and 2011 (-0.19%) .
- In the last 30 years, Austin’s median home price has risen an average 5.26% per year . The U.S. average increase over that time was 0.86% per year .
- For decades, Austin’s housing demand has outpaced the supply. The city’s current residential absorption rate is 1.5 months of inventory . This tells us that if no new listings came onto the market, the city would run out of supply in six weeks. A balanced housing supply is defined as 6.5 months . Austin’s peak absorption rate during the Great Recession was 5.3 months. And in the last 30 years, we have not had a single year where supply was greater than demand .
- Austin has been the nation’s fastest growing metropolitan market for the last decade – since the Federal Reserve began their policy of quantitative easing . The Fed continues to aggressively pursue QE, and this will likely rise the prices of all real assets over the long term, including real estate.
You might cringe when taking a look at your stock market investments these days, but you can take comfort in having some historic perspective that your Austin home more than likely remains a sound investment.