The good news: Austin incomes are rising. The not-so-good news: More slowly than housing costs.
Although the median family income in the Austin area has grown 11.5 percent from 2021 to 2022, it hasn’t kept pace with the 22 percent rise in the price of a home, according to a report published by researchers at Texas A&M University’s Texas Real Estate Center, the Austin Business Journal reported.
“What we’re seeing in the Austin-Round Rock (metro) is that there’s this increased differential, right, between median home price and median family income and generally as that … differential grows, it becomes increasingly more challenging for a household earning the median family income to qualify for that median priced home,” Clare Losey, assistant research economist at Texas A&M, told the publication.
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The gap between median home prices in the Austin metro area has steadily widened in the past two years. In 2021, the median home price was $431,000, with the median family income at $98,900, a gap of $332,100. In the first quarter of this year, the gap had widened to $414,700, with median income at $110,300 and the median home price at $525,000.
That trend is unlikely to change direction even as interest rates rise, because of strong demand and a limited supply of homes, Losey said.
A recent Redfin study showed similar declines in affordability across the country and particularly in the Sun Belt. A buyer today needs about 40 percent more income than they did a year ago to be able to afford the typical mortgage payment.
While Austin becomes less affordable, Fitch reported the Dallas metroplex is one of three metro areas in the country with sustainable home prices. Home prices have gained about 45 percent in the past three years, according to the Dallas Morning News.
[Austin Business Journal] — James Bell