Austin Business Journal shares, "Housing stock in the Austin area continues to edge higher, reaching healthier levels not seen in the metro in over a decade — and it's possible lower prices are on the horizon.
The Austin-Round Rock metro's housing inventory reached five months in June — the highest it's been since 2011, according to the latest Austin Board of Realtors and Unlock MLS market report. That's closer to the six months of inventory that housing experts say typically represents a healthy balance between supply and demand, and it's up from a level of 3.7 months of inventory in June 2023.
But what does an increase in inventory mean? According to Clare Knapp, an Unlock MLS and ABOR housing economist, buyers and sellers could expect to see a decrease in prices. However, it generally takes several months for prices to decline as the market catches up to the new inventory levels, she said, adding there's no guarantee that prices will actually fall. In June, the median home sales price was $450,000, down 6.3% from the year prior, but up from $430,000 at the start of the year.
There are multiple factors influencing the rise in inventory, Knapp said, including elevated mortgage rates keeping buyers at bay and sellers unwilling to accept lower sales prices.
“If no buyer comes in at or above [the seller’s] price point, then they just say, 'OK,' and keep their home on the market,” Knapp said. “There’s a lot of sit-around-and-wait with sellers, just seeing what happens.”
Still, Knapp said it was her opinion that the Austin housing market is neither a buyer’s nor seller’s market.
“Mortgage rates are a huge detriment to buyers,” she said. “And then sellers, their gain is primarily through equity gains … but home prices haven’t declined significantly enough for them to be able to reap some of the benefits from those equity gains.”
Plus, Knapp said sellers often become buyers, and many sellers are unwilling to sacrifice their lower mortgage rates in this high-interest rate environment.
The average 30-year fixed mortgage rate is 6.89% as of July 11, according to Freddie Mac, with the past 52 weeks averaging 7.02%. Rates peaked at 7.79% in October 2023, a level not seen since 2000.
Overall, there were 13,227 active listings in June contributing to the inventory. That’s a 25.9% increase year-over-year and is up from 7,976 in January, when Knapp said the inventory really began to increase."
Source: Austin Business Journal
Written by: Cody Baird
Published: July 15, 2024
Posted by Grossman & Jones Group on
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