The SmartEgg Blog

The State of the Austin Real Estate Market in 2023

It’s no secret that over the last several years, Austin has earned its reputation as one of the fastest-growing cities in the US. Thanks to its youthful, hipster vibe, mouth-watering foodie fare, and affordable housing, there has been a massive influx of people migrating to the area. That, coupled with the inevitable gentrification of sudden, modern development, pushed the real estate market on a rapidly accelerating growth path—at least, until federal interest rate hikes made acquiring loans more difficult. 

 

The current market dip is likely causing investors to wonder, “What does this mean for my rental properties, and what should I expect in the future?”

 


The Good News: Your Property Will Be Worth More

 

While the recent interest rate hikes have definitely caused the market to slow, it doesn’t necessarily mean that your property will lose value. On the contrary—thanks to the continued population boom, it will likely appreciate (even if it’s at a slower pace than before).

 

Austin’s allure is so great that the demand for housing is still well outpacing the supply, at least for now. It may be harder to get a loan, but that’s not stopping most potential buyers. In July of 2023, the median sale price of Austin properties was $570k. While prices did drop by 10.1% year-over-year, the market remains prosperous as more people continue to move into the area. (To understand how significant the population increase really is, consider that the median sale price in 2010 was just $200k.)  

 

If we see continued migration to Austin in the coming months, housing availability could return to its previously scarce, cutthroat state, forcing property prices to skyrocket yet again. This, in turn, would allow landlords to potentially adjust their rents to a higher, more competitive range.

 

The Bad News: Everything Else Will Cost More, Too

 

Real estate appreciation seems like a great thing… until you’re trying to purchase a property, especially those in newly-gentrified areas, such as East Austin. As incomes rise, property prices follow suit, leaving many longtime Austin residents and independent real estate investors to find properties elsewhere.

 

Unfortunately, market-induced price increases don’t stop with gentrification. The recent inflation spikes have led to ballooning interest rates, combating nationwide inflation at the expense of business owners who need loans to purchase assets.

 

So, that property you’ve had your eye on for a while? Or how about the one you already own, and simply want to refinance? Both will cost you a pretty penny (and tens of thousands) in interest. 

 

To top it off, as the Austin area continues to grow in population, fewer and fewer homeowners are listing their homes on the market, perhaps in hopes of capitalizing on inflating property values. Fewer available homes causes more housing scarcity. This, thanks to supply and demand, drives up the prices of homes on the market, further aggravating the problem.

 

So, What Should You Do About It? 

 

Despite our best guesses, there’s really no way to know exactly which way the Austin real estate market will go moving forward. For independent real estate investors, this can make it feel overwhelming and impossible to plan for future purchases. That’s why we’re here to help.


At Smart Egg, we are committed to making sure that you have all the knowledge, tools, and support you need to manage your properties with excellence and integrity, regardless of market conditions. We’ve made it our mission to make your life easier by assisting you with our extensive real estate experience and resources.


We take our goal of equipping women in Austin, Texas (and the surrounding areas) seriously, and we’ve centered our company on providing all of the educational tools and resources you need to reach financial fluency. Whether you’re a beginner or a multi-property investment maven, we want to help—and cheer you on along the way.

 

Master Any Market & Get Money Smart—Schedule Your SmartEgg Consultation Today

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