Q4 2023 Austin Real Estate Market Update

March 25 2024  – 3 Minute Read


Access our market updates by filling out your email address. The content will be free after you subscribe!

Thank you for subscribing! Please enter in the code sent to your email.

The Morshed Group Q4 2023 Housing Market Report

What happened in Q4 of 2023

  • Market Bottoming Out: After a decline in prices starting mid-2022, the market stabilized in Q4 2023, ending the year with 7-8% depreciation. No further depreciation was observed leading into January 2024, aligning with our Q2 predictions.
  • Supply Decrease: The housing supply dropped from 4 months in Q3 to 3 months by the end of Q4, indicating the market’s bottoming out. While the higher-end market saw a supply increase, the overall market remains undersupplied.

2023 Austin Housing Supply Chart

  • Interest Rate Impact: A decrease in interest rates in December contributed to a decrease in housing supply from 11,000 to 8,000 homes, alongside a notable uptick in market activity. This was supported by the addition of over 30,000 jobs and a low unemployment rate of 3.5%.

Real-World Examples

  • A unique new construction in the Deep Eddy/Tarrytown area, initially listed at $3M, dropped to $2.7M, showing slow traction despite the price adjustment.
  • Our listing in Circle C, updated under our management, sold within a week at $700k, highlighting the market’s responsiveness to well-positioned properties.

Looking Ahead to 2024

  • Q1 Activity: An increase in buyer activity and pending contracts in January indicates a robust start to 2024, with a general acceptance of higher interest rates as the new norm.
  • Market Forecast: Anticipating a single rate drop that could catalyze market momentum, 2024 is poised for appreciation. With the supply remaining at 3 months and a strong job market, we expect 4-6% appreciation in the latter half of 2024.

Advice for Sellers and Buyers

  • Sellers: The optimal listing period is post-June 2024. However, those looking to upgrade should consider selling now to leverage before the anticipated price appreciation.
  • Buyers: Despite past peak conditions for bargains, buying now is advisable to avoid decreased negotiability and increased competition expected by mid-2024.