Plum Creek Neighborhood
November 2017 Edition
Hello Plum Creek Neighbors!
So often local real estate professionals provide their clientele with updates about the real estate market using broad strokes that encompass market data of the entire Austin Metro area, Hays County, or the City of Kyle.
However, as the saying goes, real estate is all about location, location, location! Which means that home values and markets will differ by neighborhood, by street and even by the size of home.
That is why it is more important that you receive micro-level market details instead of the typical real estate data that you can easily find in a Google search.
Below you will find my market research that I’ve compiled, calculated and analyzed for you so that you can have the kind of useful and relevant information that is most beneficial to you.
As a fellow neighbor and committed advocate for our community in Plum Creek, it is very important to me that I share this important information with you. So that is why I plan to create a new Market Update every month for our neighborhood. If you are interested in receiving the following information on a monthly basis you can sign up at the very bottom of this page. I hope you enjoy!
Plum Creek Neighborhood Market Update Brochure
Download the PDF version of the Plum Creek Market Update Brochure
According to the Austin Board of REALTORS® Central Texas Housing Market Report, there was a 2.2 percent growth in single family homes sales across the Austin-Round Rock Metropolitan Statistical Area (MSA) in October 2017. If we look more specifically at Hays County, the sales numbers grew by 6.2 percent when compared to October of last year. Housing inventories are continuing to rise at a steady pace showing further signs of a more balanced market coming to the Austin Metro area. Shockingly, the same sales growth seen across most of Central Texas can’t be said of the sales activity in the neighborhood of Plum Creek where sales figures plummeted compared to the previous year. Let’s take a closer look to see if we can figure out why their is such a contrast between the Central Texas and Plum Creek housing markets.
Single-Family Home Sales
The number of single-family home sales in Plum Creek decreased from 17 sales in October 2016 to 7 homes that sold in October 2017, a decrease of 59 percent. During the same time period, the City of Kyle’s single-family home sales decreased by 9.7 percent. In October 2017, Hays County’s 20 percent increase in sales volume paints a completely different picture than what’s portrayed by the 57.5 percent sales volume decrease in Plum Creek.
When measuring the rolling total of the sales numbers for these past 12 months, Plum Creek has had a 18.7 percent decrease in the amount of homes sold as well as a 15.4 percent decrease in total sales volume. This indicates that the disappointing sales numbers for October 2017 wasn’t just a fluke that can be attributed to the seasonality of the real estate market, but could be representative that Plum Creek has experienced a downturn in the real estate market in these past 12 months. Despite the decreased sales figures, the average sales price in Plum Creek increased slightly to $212,500 – an increase of 3.1 percent compared to October 2016. Alternatively, the average sales price fell by 8.6 percent in one months time when the average sales price was just $232,630 during September 2017 (although this change could be contributed to the seasonality effects of the real estate market).
Months of Inventory
Because Months of Inventory is often misunderstood, I’m going to provide a brief explanation of what Months of Inventory is and how it helps us to understand the current state of our real estate market before I dive into the numbers:
According to the Real Estate Center at Texas A&M University, months of inventory measures “the current supply of homes offered for sale relative to the number of homes being purchased. The result indicates the number of months it would take to sell all properties currently for sale at the average monthly sales pace” which is also known as the absorption rate. According to research conducted by the Real Estate Center at Texas A&M University, a balanced real estate market in Texas is considered to be around 6 to 6.5 months. This benchmark for a balanced market represents that housing prices are stable and are influenced more by inflation rather than supply and demand. Months of inventory below this benchmark indicate a seller’s market (strong market) and months of inventory above this benchmark indicate a buyers market (down market).
Now to illustrate, the current months of inventory for the City of Kyle and for Plum Creek, which happen to be the same, is at 2.6 months of inventory. So despite sales numbers being down in Plum Creek and in Kyle, both are still considered to have a strong sellers market. Likewise, Hays County has 3.2 months of inventory, which also indicates there is a strong demand for homes in Hays County but not as strong of a demand than what is indicated by the 2.6 months of inventory for Plum Creek and the City of Kyle.
In October 2017, single-family homes that sold in Plum Creek were on the market an average of 57 days which is slightly better than the 59 days on market of sold listings in Hays County. Plum Creek homes spent an average of 14 more days on the market compared to October of last year. But, if you compare October 2017 to the month prior, homes in Plum Creek were on the market 39 days longer. That’s a negative 46 .2 percent change from one month to the other! The average days on market for every home that was or is currently available for sale in Plum Creek, is currently 55 days. Plum Creek had 4 more new listings compared to last October. At the same time, Hays County also saw a decrease of 9.7 percent in the number of new listings on the market.
The Bottom Line
The demand for homes in Plum Creek is still strong as indicated by the 2.6 months of inventory. However, the decline in the number of homes sold and the total sales volume during the past 12 months and in year-over-year sales comparisons gives cause for concern especially when the statement below contradicts what the sales activity in Plum Creek may be indicating.
“The Austin-Round Rock housing market continues to slightly outperform last year’s home sales activity, keeping 2017 on-pace for another record year for home sales.” This statement came from the 2017 President of the Austin Board of REALTORS®, Brandy Guthrie, in the press release that was published along with the Austin Board of REALTORS® latest Central Texas Housing Market Report.
The slight increase in the average sales price of homes that sold in Plum Creek may provide a little comfort for those who just purchased a home. However, homeowners in Plum Creek should continue to closely monitor the sales activity in Plum Creek so that they can be prepared for the inevitable shift in the market whenever it does occur.
The Austin Board of REALTORS® also provides market statistics for all of the surrounding zip-codes. You can view that information HERE.
So there you have it! I hope you enjoyed this edition of the Plum Creek Neighborhood Market Update. If you have any questions about how the current market effects your homes value or chances of purchasing your dream home in Plum Creek, please call me or click the links below.