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Hi Austin Texas, it is time for your housing market report for the week of July 20th.
market stats Highlights Include:
- As of Monday there were 7452 homes for sale in Austin Texas down from our highest inventory number of the year which was last week when we had 515 more homes available.
- There are 1413 new listings that came to the market up in the week prior (that’s 58 more homes than last week).
- There are 2083 home price decreases.
- There are 213 home price increases up from 146 last week.
- There are 234 properties that fell out of contract now back to the market that is up from the previous week.
- There are 611 properties that went Under Contract (up from the week prior).
- There are 545 Pending properties for Sale (also up from last week).
- We saw 772 homes Sold which is up from the previous week (+18 houses).
- 218 were taken off the market (up from last week slightly).
- 35 homes had listings that expired (up from last week slightly).
- 128 Homes are now on hold.
What Does it mean if your a seller?
Given the inventory numbers hovering above 7000, Sellers are finding more competition in most price points. A well priced move-in ready house will sell for more. There was a time months ago that Sellers didn’t have to have “the perfect house”. Taking the time to update your home will pay off at the negotiations table. And, you may still be seeing a bidding war. More on that later.
Sellers, how your home is marketed to Buyers is more important now than ever! Marketing is not about putting a sign in the yard, putting it in MLS and praying for multiple offers or even one decent offer.
Austin, aspirational sale prices based on homes that have closed in the past 30 days are no longer strong comparable price points like they were several months ago. The market has shifted toward normalizing and even with the increased lending rates, Austin is still very much a Seller’s market based on Buyer demands. Meaning we have plenty of buyers with 515 homes showing with 2083 households decreasing the price points. And, many Builders now reducing their insane rates while they continue to build. Lumber prices coming down is helpful for the future costs unless Builders can get away with guaging Buyers which does not seem to be the case with market today.
If You’re A Buyer
If you are buying a home in Austin Texas then you need to know that we continue to be in a hot sellers Market. Buyers, you may find that you’re approved by your Lender for less money due to rising interest rates. You can also anticipate higher costs as home values increase. The good new is we’re seeing an increase in inventory.
FHA Buyers are seeing more favorable opportunities now that the market has shifted.
The Build-to-Rent Market is Growning by Design. It’s an aggressive play as the Fed wants less home ownership. People are making a lot of money as people feel the pressure of the economy. Our property taxes are very real in Austin and many people are tradingtheir equity position in owning a house. Real estate has always been the most stable way for Americans to build wealth. The tax burden associated with ownership is part of budgeting.
Developers who are 30-45 minutes out of town are looking at the money they can earn building build-to-rent. And, our city benefits from taxes one way or another. They get it from the builders from development and from us as homeowners on taxes. Rents are increases.
Waiting on Housing Prices to Come Down? Price increases are slowing.They’re not stopping. If you’re going to wait for the housing market to drop before buying a house then while you may benefit from a slight price decrease, that gap will likely be taken up by increased mortgage rates. And, five years from now odds are that house prices are going to be higher than they are today. If you’re considering that you will live in your home over the long-term, you’re going to be fine. If you buy the house now and refinance later when rates are lower you’ve been paying down your loan the entire time. While many houses aren’t selling as fast as they were a few months ago, amen! And, there are not as many offers. However, that doesn’t mean prices are going to go down in Austin Texas. We are going to remain steady or grow slowly.
Are we Seeing News of Lending Companies Closing? Not this week. As mentioned last week, the companies that have announced closing or layoffs had either the smartest or dumbest business model on the planet as they were designed to capitalize on people re-financing at lower rates…. which could not continue.
Now, I’m not an economist. I’m a Realtor. However, my basic, and I do mean basic understanding about the National debt, the total amount owed by the United States has increased 35% faster in the past 2 years than any other time in history. The GDP which stands for gross domestic product is the entire market value of all the goods and services produced within the country and it is used to measure economic output to know if we’re growing as a result of incomes increasing and people spending more money OR is that number going down like it is right now. Did you know that we’re seeing less supply chain issues now and that we’re still experiencing labor shortages to get supplies where they need to be. So, what else? The stimulus was great and now we’re paying for it.
The United States is currently raising our interest rates faster than the rest of the world. And, given that the US is seen as a safe-haven asset, it means that globally during times of economic uncertainty, the US is a good place to park some extra cash. So other countries may be looking to pay down their loans as quickly as possible to lower their total amount owed. Or not… because they can only pay so fast and inflation is making their dollar weaker. It’s all beyond me.
Is national debt an urgent issue? The bigger question to me, and I’m simple, is whether demand is slowing down because people believe the economy is getting worse. The media, aka the news aka how do we sell ratings and get people to keep coming back…. The media is helping to ensure a self-fulfilling prophecy shouting of health uncertainty for the past year and now economic uncertainty which results more economic uncertainty. And, to answer my own question, here’s the thing, we believe what we perceive. Gas prices dropped this week. Is that a sign of slow down already? I doubt it. I honestly expect prices will rise again… but who knows.
So, let’s get our home purchasing and selling bonnets on. This is where my knowledge, skill and strength truly are when it comes to navigating the waters. I can’t and won’t stick my head in the sand and pretend that our economy is always at the forefront of everyone’s mind. And, our economy begins at home. With our wallets.
And, right now there is a shift in most people’s 401Ks and Crypto holdings which are down for most of us. The market volatility is affecting the housing market. I could have said that from the beginning. I know. However, I owe it to myself and to you to follow the global economy because it affects our micro economy buying and selling homes in Austin Texas. Our tax rates affect our purchasing power. Upcoming bond votes will affect purchasing power. Folks if our taxes stay the same as they were last year, given the value increases in our homes, our tax bills are going to be a lot higher even with a 10% homestead cap on how high taxes can go. And, don’t forget you can protest your taxes every single year.
That said, our house valuations were pulled on data from earlier this year. So, even if the value of your home is now less than it was in January or February, you’re going to see the rate hiked as high as possible – odds are you’ll be banging your head on that 10% tax increase if you’re a home owner.
Buyers, Your Most Valuable Asset is a great Real Estate Agent. It’s your Realtor that will get your offer accepted in this competitive Austin Texas real estate market. We’re not going to be at 3 or 4 months of inventory any time soon as people will pull back on selling their homes in come late November just as they always do. So, if you’re thinking you can get a deal, then put someone to work for you! Don’t be confused that going direct to the Listing Agent or Builder. Neither are going to negotiate great terms for YOU.. The Listing Agent represents the Seller. And, they cannot represent you. It’s called Dual Agency and it’s illegal to represent both the Seller and the Buyer as clients. If they are the Listing Agent, the Seller is their Client. Builders represent themselves. YOU want to be someone’s Client. YOU want someone who will get you the best terms for YOU. Someone who will go to the wall for you when the Seller or Builder do something weird. YOU want someone who understands the market and will not only get you a house under contract… they’ll get you to the closing table and get keys in your hands so you can sleep in that house. In case you didn’t catch that,
A Builder represents their own best interests. The Builder isn’t interested in anything but getting that contract. Do you really think they’ll negotiate the best terms for an unrepresented Buyer? Because you’re nice. Hello. McFly?!
That said, Builders are now starting to offer Buyers incentives again… if that’s any indication of their goal of selling more homes. Is the Builder gauging Buyers train over? I’m a solid maybe. Because there’s still limited inventory, construction delays due to product still floating in the ocean and frankly, they were getting fat taking advantage of people. Not the really good ones mind you. More Builders than not have blackend their eyes with both Conumers and Realtors. Builders are now asking Realtors to come in for events and even to promote their new construction properties. This is a shift. The fact that they’re now singing from a different hymn sheet will not be heard by many for time to come.
The Builder will Offer That You Work with Their Lender. Do not get caught up in what looks like a decent rate. Because the rate is only one part of the equation. What happens when you want to pay down your mortgage early, or refinance down the road? What does the small print say? What are their fees? PS Builders are highly incentivized to have you work with their preferred Lender. Meaning the Builder gets paid if you work with their Lender. And, what happens when you now have two key members of your home Buying Team working for themselves and not you in what may be the biggest purchase of your life? What you don’t get is the level of service or ingoing and longer term strategic options for your borrowing. I get my Buyers with top Lenders and what I receive from it is the high satisfaction of knowing that you, as a Client have someone who is going above and beyond to ensure that you can get the best possible mortgage terms that will serve you today and for years to come. What I experience is you knowing that you understand your monthly payments, whether you are esctowing taxes or not. What I experience are Buyers who know they’re educated and cared for during their home buying process. That let’s me sleep at night.
We’ve covered a lot today. The long and the short of it is there are opportunities for Buyers and Sellers in this market. Interest rates will continue to move and we wont see a sub 3% rate anytime soon. Will we see a 6%+ rate this year? I think so. So, if you are considering buying, selling or investing in Austin do your homework. Ask questions and, next week we’ll have another Austin housing market update for you. I’d love to hear your thoughts on the market, the economy and what you’re experiencing as you consider where you are living, loving, working and playing in Austin Texas. Please comment below.
I’m Jennifer S. Goodman Living in Austin Texas. We’d love to hear from you.
Thanks for tuning in, we’ll catch you next time.
Want to talk about real estate? Please feel free to call or text at 512.548.4568