Throughout the mid-pandemic homebuying boom, out-of-state buyers transformed Austin, Texas into one of the hottest real estate markets in the country, driving up demand for luxury homes and keeping builders busy with a backlog of new projects. Two years later, luxury home sales are down 37.6% over a silent three month buying period ending August 31, and new housing stock is piling up as the share of regional buyers falls at a steady pace, The Wall Street Journal reports.
Austin home sales are slowing, demand is dwindling, and new inventory is stacking up, forcing builders and developers to pump the brakes on new construction projects and, in some cases, to make concessions in order to sell completed homes.
“There’s a glut of projects stacking up,” said Chester Wilson of Greater Austin Builders, which stopped buying land last year. Mr. Wilson estimated that he and others have about 50 new homes in the pipeline in Zilker and Bouldin Creek, two affluent Austin neighborhoods.
With homes taking longer to sell, Mr. Wilson and his partners have pooled money to cover the carrying costs of each house in their pipeline, about $150,000 to $200,000 per project. Recently, they sold a teardown to another builder for a $17,000 loss.
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