• Single family home sales up 10% over Jan 2011, the 8^th straight month of increased sales.
• The median price for single family homes was $176,550 which is down 7% from Jan 2011.
• There were 1638 pending single family home sales, up 16% from Jan 2011.

Sales are up and prices are down? Makes sense if you think about it, 12-18 months ago the market was slow.  Over the past year and a half, prices have adjusted down and demand has come back in to the market and we’re now on an 8 month trend of year over year increases in sales.

But for me, the real story here is the current inventory levels, because that is going to dictate what we see in terms of unit sales and prices as we move in to the busier spring and summer home buying season.  Inventory of single family homes at 6557 units is down 19% from Jan 2011.  There were 2226 new listings in January which is down 6% from last January.  Combine that with the 16% increase in pending January sales mentioned above, and that tells me that unless the listing agents have been some very busy beavers – year over year inventory in February 2012 is going to continue to decline – even with the extra leap year day for them to take listings.

In certain sub markets this inventory trend is even stronger, and it’s starting to reflect in price:

• In MLS area 1A which covers Northwest Hills area homes, inventory is down almost 40%, new listings are down over 7%, sales are up over 44%.  With numbers like this it’s no surprise the median and median price for 1A bucks the area wide trend and is actually up 2.2%.
• In MLS area 1N which comprises a good amount of the Northwest Austin houses for sale, inventory is down 40%, new listings are up over 12%, sales are up 125%, and sure enough median price is up 10.7%.

It appears we are at a bit of an inflection point in the return of a healthy housing market.  Buyer demand is coming back as evidenced by the overall increased sales numbers and some really strong increases in certain sub markets.  But if the supply of houses for sale in Austin continues to decline, this could slow down sales as buyers will become frustrated by the limited choices or competition for the quality houses that come on the market.

If you’ve been thinking about selling a home in Austin, it is probably a pretty good time, although holding off for a few months may be financially beneficial if the supply stays low and competition among buyers really heats up.  Regardless, for sellers looking to move up, or empty nesters looking to downsize, 2012 should be a good year to do it as it appears you’ll be able to sell your house in Austin fairly quickly, and interest rates for buying a home are still really low.

For people buying a home in Austin, you need to be prepared to move quickly because when quality houses go on the market they go under contract quickly.  We’ve already been seeing this trend, a few weeks ago I posted a blog about houses going off the market before buyers could even get in to see them.  If you don’t already have a custom search with listing alerts set up that’s the first thing you should do – register to do it here.  Furthermore, I’m advising all my buyer clients to move their listing alert frequency to daily alerts from weekly, and making myself as available on short notice to go look at new houses that come on the market that they are interested in.

And along those lines, we had a bunch of positive news last week about the Austin jobs economy. Austin economist Angelos Angelou is predicting a great 2012 in the housing, real estate, video games and clean tech industries.  This coming off a 2011 where there were20,100 jobs added, beating his prediction of 18,500.  In addition to this the Austin Business Journal reported Austin had the nation’s sixth highest retail job growth adding 2,700 jobs in 2011 and was number 29 for manufacturing job growth adding 1100 jobs.  Austin has a very healthy and diversified jobs market, across all industries and income levels. This news should be very re-assuring for Austin home owners and people buying a home in Austin as this job growth will contribute to a stable Austin real estate market.

So it got me thinking, is the Austin housing market heating up?  Let’s take a look at some data from the Austin Board of Realtors.  Data for January is not available yet, but as of 12/31/2011 the available supply of properties across Austin was 7,758 units, representing a 22.5% decrease from the 10,005 available a year earlier on 12/31/2010.  That’s a pretty meaningful drop in supply. In MLS area 1A which comprises a lot of the Northwest Hills Area Homes, supply had dropped 39.4% from 137 units to 83 units.  In MLS area 1N which covers a lot of Northwest Austin Homes supply had dropped 38.8% from 170 units to 104 units.  Those are some pretty large drops in supply compared to the same time last year.  This is a result of 7 months of year over year increases in sales, with less housing coming on the market.  It means less choices for buyers and in theory more competition for the well priced quality homes in Austin.

But it doesn’t mean the market is heating up unless there are buyers out there competing for the homes.  I pulled some real time data out of MLS to get a feel for that.  Of the 27 houses listed in area 1A since Jan 10 (about the past 30 days) 8 of them or about 30% are already in a pending contract status, and all of those 8 went pending in 7 days or less from hitting the market.  In area 1N, of the 54 houses listed in the past 30 days, 17 of them or just over 30% are already pending contract, and they all went pending in 11 days or less from hitting the market.

In my opinion, this seems like in fact the Austin real estate market is picking up. If you’re think of selling a house in Austin, and I told you 30% of the houses go pending in 11 days or less I think you would be pretty encouraged.  But remember, they key is to have it priced appropriately and in good condition.  If you are looking to buy a home in Austin, when you see a house you like, that appears to be priced right and in good condition – I would advise taking a look at it as soon as you can.  Setting up a custom search and getting automatic email alerts for new listings that meet your criteria is a good idea so you know about a potential home when it hits the market.  Did I mention you can do that on this website – to get started, click here to register.

A: Absolutely not, we are a full service Austin Real Estate company.  We’ll help you find a home, answer your questions, provide comparable market data, submit an offer, negotiate the contract, and see the process all the way through from inspection to closing.  We’re able to offer the 30% buyers’ agent rebate because technology has made the process of helping people find and buy homes much more efficient.

Read More: About why we offer real estate rebates

Q: How much will my rebate be?

A: That depends on the commission paid.  We rebate 30% of the gross commission paid to the buyer’s agent, including any incentives or bonuses.  Commissions are not fixed, but most of the time sellers offer to pay 3% of the sales price.  So if the house is $350,000, a 3% gross commission is $10,500 and we rebate $3,150 to buyer(s) we represent.

Q: When will I get my rebate?

A:  After the purchase of the home closes and funds, the title company will send us a check or wire us funds for the gross commission.  Once we receive the check/funds we process a rebate check that we send to you within 2-3 business days.

Q: Can I apply the rebate to my closing costs instead?

A: In most cases no. Most lenders will not allow the rebate to be used towards the funds required for down payment and closing costs. Those funds have to come from your current documented bank account assets, not the real estate rebate.  In a situation where you are paying cash for the home, we may be able to credit the rebate towards your closing costs.

Q: Is there any way I can get more than a 30% rebate?

A: We do offer some additional rebate benefits for certain groups – Active Duty Military & Reservists, Veterans, Teachers, Firefighters and Law Enforcement.  We also have a program that supports local schools through donorschoose.org that you can participate in.  You can donate part of your rebate and we will match your donation up to 3% of the gross commission in your name.

Q: How can you afford to offer this rebate when most other agents/brokers won’t?

A: It’s simple, technology has made the cost of working with buyers come down; and we run an efficient operation.  We’re an independent Austin real estate brokerage with no franchise fees or splits, we use efficient cost effective technology to serve our clients, and we keep our overhead low – no big expensive fancy offices.

Read More: About 360 Real Estate | A blog post about our rebate concept

Q: If I want to use you to buy a home and get the rebate what do I need to do?

A:  Contact us however it is convenient for you.  Call us at 512-410-7350 and we’ll answer any home buying questions you have and/or help get you set up with a custom home search.  You can register for free on our website and browse Austin real estate listings; and save your favorite properties and searches.  Or you can send us an email and we’ll get back to you by email with an answer to your inquiry.  However you want to work with us, you can EXPECT us to be responsive and provide great service.

It was sometime in 2007 when I started getting calls that went something like this. “Hey Ted, we found a home we want to buy online – already saw it at an open house – and we love it.  Can you help us with the market comparables, contract negotiation and inspection through closing process?  And since we already found the house on our own, will you give us some of the commission back? It sure would help out with the moving expenses.”

Seems like a pretty reasonable request doesn’t it?  Since a good portion of a buyers’ agent work was to actually help find the clients a home, if that had already been done by the buyer why not rebate some of the commission back them reflecting the reduced work load. Since giving a real estate commission rebate is allowed in Texas, there aren’t any legal or ethical issues in doing it.

What was really going on….

What these requests really were was an indication of what was happening online.  Sites like Zillow, Trulia, Realtor.com and locally AustinHomeSearch.com were rapidly gaining traction and consumers were using them to find houses and get a feel for prices in different neighborhoods.

About the same time most local realtor boards and big brokerages were moving to web based/software as a service listing and IDX (internet data exchange) systems. These systems allowed realtors to provide much more data about their listings in terms of more pictures, virtual tours, extended descriptions etc.

This data, syndicated out across the web put a lot of information about houses for sale at consumers’ fingertips.  Add to that advances in satellite map and street view technology from Google and Bing and home buyers have a good portion of the information they need about a house readily available to them. Prospective home buyers can get a really good feel for what a house looks like, where it is – is it a corner lot, does it back to a busy street, what the neighborhood looks like, and other critical data like tax assessments and schools.

If the customers are asking for it…

Maybe this is the way a lot of people want to buy houses now.  In fact it is.  A National Association of Realtors (NAR) study says 89% of home buyers now use the internet for information when starting their home search.  We’ll go out on a limb and speculate that in tech savvy Central Texas, close to 100% of people buying a home in Austin use the internet for their home search.  Additional data from NAR shows 66% of internet searching home buyers drove by or viewed a home they saw online and 41% of buyers first found their home on the internet.

Giving a rebate makes sense…

If you think about it, it makes a lot of sense.  There aren’t very many things that haven’t become more efficient and less expensive as a result of technology.  You can buys stocks online for $10/trade, and booking travel is much more efficient online than using a travel agent or calling around to hotels and airlines.  And it’s not as if online services are limited and leave you on your own to figure it out.  Last time we checked eTrade had an abundance of online resources and Travelocity provided comparison shopping and reviews.

Yet, with all the advancements it technology being used in real estate, it seems like many real estate brokerages and agents still charge 3% on each side of the transaction (3% for the seller’s agent, 3% for the buyer’s agent).

How we do it at 360 Real Estate….

We charge you less than 6%.  We give a 30% rebate to home buyers we represent, and charge 2% for the seller’s side when listing a home for sale (still 3% to the buyers for 5% total).  We’re able to do this because:

1. We are an independent real estate brokerage covering the Austin, TX metro area. We don’t have any franchise fees or commission splits going to “the house” – no pun intended.
2. We use efficient technology. Online tools used to search and find homes are now readily available at a reasonable cost. We think we have a nice looking functional website, but we’ll let you know we didn’t spend tens of thousands of dollars having it designed and custom applications developed.
3. We keep our overhead low. These days real estate work is either online or in the field – at the houses buyers want to buy, and sellers want to sell.  There is no need for, and we don’t have big expensive fancy offices with plush furniture, espresso machines, and our sign on the side of the building.
4. We know you (our customer) will be more efficient to.  How do we know this?  If you are on this site you didn’t find us from a mass post card mail out, shopping cart advertisement, glossy magazine ad, or a building sign off the freeway ….because we don’t do that type of inefficient traditional marketing. Odds are you found us online, which means you are likely browsing for houses online and will probably do a lot of the home search and review online.

And we say go to it, on this site you can browse homes by map, zip code, address, schools or a number of other criteria.  And you can save your favorite houses or get email alerts for new listings that meet the criteria of your saved custom searches.  If you need help or have any questions call or email us.  Remember, we’re a full service brokerage and here to help, so if you want to see some houses or have questions just let us know how we can be of assistance.

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