How Rising Costs and New Construction Drove a 19.2% Increase in Austin MLS Listings in 2024

September 03, 2024 : The Austin real estate market in 2024 has experienced a significant increase in activity, particularly reflected in the cumulative new listings from January through August. This year, the number of new listings in the Austin Area MLS is 19.2% higher than the historical average for this period, which marks a substantial deviation from past trends. To fully understand the implications of this data, it’s important to examine how 2024 compares to previous decades and economic cycles, as well as consider the various factors contributing to this surge, including increased living costs, higher taxes, and record-high new construction activity.

Seasonal Trends in Austin MLS Listings Since 2000 : The data from 2000 to 2024 reveals clear seasonal patterns in the Austin real estate market. Typically, the spring and summer months (March through August) have been the most active in terms of new listings, while the fall and winter months (September through February) see a slowdown. This seasonal cycle is influenced by factors such as weather, school calendars, and economic conditions.

Early 2000s: Economic Expansion and Housing Boom : In the early 2000s, the Austin real estate market saw a robust increase in new listings during the spring and summer months, driven largely by the tech boom. This period marked significant population growth and housing demand in Austin. For instance, in 2001, new listings peaked during the summer, significantly higher than in the winter months. This pattern continued throughout the early 2000s, with the market experiencing a steady rise in new listings each spring and summer as more people moved to the city.

Mid to Late 2000s: The Housing Bubble and Financial Crisis : The mid-2000s continued the trend of increasing new listings, particularly during the spring and summer seasons, as the housing market reached its peak nationwide. However, the financial crisis of 2007-2008 caused a sharp decline in new listings, especially noticeable during the typically active spring and summer months. For instance, the number of new listings in the summer of 2008 was significantly lower than in previous years, reflecting the broader economic downturn. The fall and winter months saw even fewer listings, as market uncertainty kept both buyers and sellers on the sidelines.

2010s: Recovery and Renewed Growth : The early 2010s marked a recovery in the Austin real estate market. By 2012, new listings had returned to more typical seasonal patterns, with increases during the spring and summer months. This period also marked significant population growth in Austin, driven by the city’s growing reputation as a tech hub. The market’s recovery was particularly evident in 2015 and 2016, where summer listings were notably higher than in the winter, reflecting the return of seller confidence.
Throughout the 2010s, the seasonal pattern of spring and summer surges in listings remained consistent. By 2017 and 2018, the market was particularly active, with strong numbers during these peak seasons. This growth reflected increasing housing demand as more people moved to Austin, coupled with favorable economic conditions.

2020s: Pandemic Impact and Rapid Market Changes : The 2020s brought unique challenges and shifts in the seasonal patterns of new listings. The COVID-19 pandemic initially disrupted normal market activity, with a slight dip in new listings in 2020, particularly during the spring. However, by 2021, the market had rebounded strongly, with new listings in the spring and summer months exceeding those of previous years. The rise in remote work and continued population growth fueled this recovery, making Austin one of the most active real estate markets in the country.

In 2022 and 2023, the seasonal pattern continued with strong spring and summer activity. However, 2024 has been particularly notable, with a 19.2% increase in cumulative new listings from January through August compared to the historical average. The spring and summer months of 2024 have been exceptionally active, with new listings consistently outpacing those of previous years.

Contributing Factors to the 2024 Surge : While the increase in listings could suggest a thriving market, several underlying factors indicate a more complex situation. One significant driver of the rise in new listings is the increasing cost of living in Austin. Over the past few years, housing affordability has become a pressing issue, with rising property taxes and other living expenses pushing some homeowners to sell and relocate to more affordable areas. This trend has contributed to a higher number of homes being listed on the market, particularly in 2024. This resource can be found in our New Listing to Pending Ratio; a resource that is updated weekly. 

Additionally, new construction activity in Austin has reached record highs. The city’s continued population growth and demand for housing have led to a surge in new developments, adding to the inventory of available homes. This influx of new construction has further increased the number of listings, particularly during the spring and summer months when these new homes are most likely to be completed and put on the market.

Moreover, there is a possibility that some homeowners are looking to capitalize on current market conditions, anticipating that prices may peak soon due to the increased supply. The combination of existing homeowners listing their properties and new construction hitting the market has created a substantial boost in the number of active listings.

Matching Seasonal Data with Economic Analysis : When comparing the 2024 data to previous seasons and economic cycles, it becomes evident that this year’s surge in new listings is part of a broader trend of market resilience, influenced by both economic pressures and ongoing demand. The early 2000s saw similar increases during the tech boom, while the recovery in the 2010s brought about strong seasonal activity. However, 2024 stands out due to the magnitude of the increase, particularly during the typically active spring and summer months.

The rise in new listings in 2024 may reflect a market that is grappling with the challenges of high living costs and increased taxes, as well as the effects of a construction boom. While these factors contribute to a growing inventory, they also suggest that the market is experiencing significant changes that could affect pricing and overall market stability in the near future.

The cumulative new listings in the Austin Area MLS from January through August 2024 represent a significant increase over the historical average, marking a return to high levels of market activity not seen since the early 2000s. However, this surge is driven by various factors, including rising living costs, increased property taxes, and record-high new construction activity. When analyzed within the context of past decades and economic cycles, 2024 emerges as a year of both growth and potential market shifts. As the year progresses, understanding these contributing factors and their impact on the market will be crucial for real estate professionals, buyers, and sellers navigating the dynamic Austin real estate landscape.