Well it sort of feels like Groundhog Day all over again…
We had a bit of a slowdown in the market last year come summer and through the fall. (And by slow down, I just mean fewer multiple offers and fewer homes going 10%-20%+ over list price).
The general consensus among agents and other industry professionals was that we would remain in a seller’s market, but that it would be a bit more reasonable for buyers moving forward. We knew that interest rates were going to rise, expecting that to take reduce some of the competiton, but it hasn’t appeared to make a difference as of yet.
NOTE: Interest rates are still at record lows, so I’m not predicting a massive drop in buyers entering the market, but higher rates WILL impact what buyers can afford.
So, where does this leave us now?
Well, according to most predictions, we’re going to see another year of double digit price increases. In fact, Zillow has revised their predictions and is now predicting home prices to go up 22% nationwide. The chart below was from an article on Fortune.com
But, really, when it comes to real estate, it’s the micro markets that we need to pay attention to.
What about Austin?
So, in Austin, we’re ranked #1 among millenials and the second-best home market for Gen Xers! And we still have major companies making Austin their headquarters. TikTok just took over the top 6 floors of a new building in downtown!
This chart goes back to January 2015. The red line is the inventory. As you can see, since the onset of the pandemic, the number of active listings has declined year over year and the trend line doesn’t suggest were’ going to catch up to seasonal norms any time soon.
What’s even MORE interesting, however, is the closed sales do not show anything out of the norm. Year over year increases are pretty consistent for the last 7 years.
So what this MEANS is that fewer people are moving (aka selling their homes), yet more and more buyers are coming TO Austin. For those reasons, we are not expecting any relief in the forseeable future.
So, here’s the cold, hard truth…
If you want to buy in the greater Austin area this year, then you really don’t want to wait…
Here are 3 Things You Need to Know/Do to Get Your Home This Year (and I’d recommend moving on it sooner than later because it may take a few ‘at bats’ and interest rates are on the rise):
- Know Your Numbers. Virtually every “properly priced” home is going under contract in a matter of days, and with multiple offers in most cases. So, that means, you’ll have to know what you’re comfortable coming out of pocket with to close. In many cases, you will still meet value with your appraisal, but you need to know where you’re willing to land if not and have a game plan.
- Be Prepared to Make A Strong Offer. A few weeks back, I sent out an email with about half a dozen “terms” of the TX real estate contract that can strengthen your offer and help push you over the edge when a seller/listing agent is looking at pretty similar offers. These include things like: Waiving your financing contingency (we have a program with our lender to minimize your risk while doing so), Covering standard seller closing costs, etc.
- Marketing. The MLS (and Zillow and Redfin et al) are not the only ways to find homes. I have been flipping houses for 20+ years and have done over 90% of my “deals” with off market sellers. I’ve got a tried and true system for finding these homes, but you need to zone in on a specific neighborhood for this to work and maybe be a little flexible on your wish list. But this, is hands-down the best – and possibly ONLY – way to find a home at/below market value in this market…
Would love to connect with you if you’re planning on making a move this year. Let’s put your plan in place… Schedule a call here.
