Austin, which was once a migration hotspot, is losing out homebuyers to other cities, as homebuyers are looking to leave the city rather than move in during the third quarter. This data is as per reports from Redfin, a tech-powered real estate brokerage company. For the first time since 2017, the Texas capital has not shown a net inflow.
Most homebuyers are looking for homes outside the metro areas of Austin, as the number doubled in one year.
According to the Business Wire,
“This marks a stark reversal for Austin, which was a magnet for out-of-town homebuyers looking for a more affordable place to live even before the pandemic. Once the pandemic began, ushering in an era of remote work and record-low mortgage rates, Austin’s popularity boomed: It was the number-one U.S. migration destination in the beginning of 2021.”
One of the major reasons for the decline in home buyers is rising home prices since 2022. The prices of homes in Austin peaked during mid-2022. Since the pandemic, prices have been up by 75%. Since that peak, prices of homes in Austin have declined. However, the prices are still quite expensive as compared to pre-pandemic prices.
On the other hand, monthly mortgage payments in Austin have also doubled since the pre-pandemic period. This also led to affordability problems for homebuyers as mortgage prices became even more expensive. The typical monthly payment for a median-priced home ($455,000) in Austin is $3,890 if the average mortgage rate is 7.63%. The amount has almost doubled since 2019, when the number was $2,136. Many remote workers who live in Austin are also leaving and going back to their home cities. On the other hand, some homebuyers are moving back to their cities after realizing that staying in Austin is not fully affordable in the long term.
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