Third-Quarter Surge in New Homes Set to Shake Austin Real Estate?

If there was a city in the world that truly defined the term “hot market,” Austin is it. For many years the supply of homes has been struggling to keep up with the demand for living spaces. It creates a seller’s market, where there are simply not enough homes to meet the demand, putting all the power in the real estate transaction in the hands of the property owner. Buyers are left to fight it out among themselves, meaning there’s often someone who is willing to meet the asking price.

Interestingly, new data for the third quarter of 2017 shows a steep rise in the number of homes which are about to hit the Austin inventory. Nearly 4,600 new houses began construction in quarter three in Austin, which is a huge 12.5% leap on the number of new homes when compared to data from 2016. We explore how will this affect our real estate market…

Is Supply Catching Up With Demand?

This is the highest number of new homes Austin has seen since 2006, with new constructions at an 11-year high, according to data supplied by Metrostudy. The Austin-Round Rock metro overall is also seeing record numbers of new homes being constructed too, which is also achieving an 11-year high, up 19.1% when compared to 2016’s figures.

It would make sense that a record number of new homes hitting the market would come with a great effect. An increase in the supply – in the inventory of homes available – should have the effect of tipping the balance of power in a real estate transaction in favor of the buyer.

When all these houses go to market, buyers might just find themselves with plenty of options which would suit their real estate needs, and find themselves in a strong position to put pressure on asking prices and grab a bargain. Builders have already offered some decent discounts on new homes in order to get ahead of the glut of competitors that are out there. There are already bargains to be found for the savvy real estate detectives.

Can Austin’s Demand Swallow It?

The demand for houses in Austin isn’t something that anyone should be surprised to hear about. Austin’s market has been setting records for well over 10 years now, drawing young professionals from far and wide, putting huge strains on our ability to adequately provide everyone with their dream home.

The real question we need to ask ourselves when facing a huge increase in the inventory, is can Austin swallow it? The demand which drives real estate in our city could so easily sweep over the additional properties, and continue with the decade-long trend of increased house prices and red-hot competition for available homes.

Time will tell whether the sheer desire for Austin real estate will just devour this batch of new homes, however, those looking to sell their property might see this as a good time to get ahead of the curve. Conversely, buyers might look to use this future pressure to secure a better deal on real estate now.


Whichever way it goes, this shake to the balance can be to the advantage of all if you play the game correctly. Harlan Realty knows Austin. Contact Us for free advice on how you could make the most of your Austin Real Estate.