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(Austonia staff)

The Austin housing market continues to thrive despite the ongoing pandemic, but a continuing inventory shortage could jeopardize its growth.


The median sales price in the city of Austin increased 10%—to $433,493— in November, according to the latest Austin Board of Realtors market report. Meanwhile, the housing inventory fell to less than a month's worth. The Real Estate Center at Texas A&M University estimates a balanced housing market has more than six months' inventory.

"Despite the economic roadblocks and challenges the global pandemic has presented, Austin's housing market activity is stronger than it's been in several years," ABoR President Romeo Manzanilla said in a statement Wednesday.

The rising home prices and falling inventory go hand in hand.

"This near-zero level of housing inventory throughout the region is staggering, and it will put enormous pressure on home prices and the rental market," he said.

The trend is not limited to Austin; the five-county Austin-Round Rock metro also reported a record-breaking median sales price—as well as an all-time low level of inventory.

The median home price in the metro increased nearly 20% to $365,000 while the housing inventory fell to 0.9 months' worth, according to the report.

This is concerning, Manzanilla said.

"Central Texans who could not find a property within Austin's city limits have historically been able to expand their searches outward to find a home," he explained. "But, when the entire region has virtually zero inventory, its leaders must think about how such a broad lack of housing will ultimately impact Austin's sustainability as a destination for business and economic growth."

Demand for housing is amplified by the influx of new residents.

Austin leads U.S. cities in population growth, according to LinkedIn's latest workforce report, which was published earlier this month. And hiring is up year-over-year.

Some big-name tech companies have also attracted national attention for their presence in town.

Tesla is hiring executives for its forthcoming Southeast Travis County Gigafactory, and its CEO Elon Musk is also house-hunting in Austin. Software giant Oracle also recently relocated its headquarters to Riverside Drive from its previous location in Silicon Valley.

"This growth is not sustainable," said Mark Sprague, state director of information capital at Independence Title, in a statement. "The one variable that will hold the market back is the lack of inventory."

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