February 27, 2024 | Driving It Home with ABoR's Housing Economist

In this episode of Driving It Home, Dr. Clare Losey and Emily Chenevert discuss construction costs and their impact on the housing market. Dr. Losey notes that single-family construction costs have stabilized on a year-over-year basis, with construction labor costs flat and material costs up by about 3%. This is a significant slowdown from the spikes seen during the height of the COVID-19 pandemic. The stabilization suggests that builders may not pass on higher costs to consumers as previously, which could alleviate upward pressure on new home prices.   Supply chain constraints, which were a significant issue during the peak of the pandemic, have largely diminished as recovery continues and countries reopen. However, there remains a shortage of construction labor, which continues to impact the housing industry. Dr. Losey emphasizes the importance of investing in training and education to address this shortage. She also points out that despite the year-over-year stabilization, construction costs are still significantly higher than pre-pandemic levels.   The local Austin market is experiencing steady activity, with a slight uptick in mortgage rates to 6.9% and steady month-to-date transactions compared to the previous year. There are more active and new listings in the market, reflecting a slight increase in inventory. The leasing market also shows an increase in closed leases and active listings, which may be influenced by the influx of rental inventory from institutional investors during the pandemic. Dr. Losey suggests that the housing market is showing strength and balance, providing opportunities for both buyers and sellers, despite potential adjustments to the higher rate environment.   Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732 YouTube: https://www.youtube.com/playlist?list=PLzH_caxJ3VPq5iExWilqZOahnREgSFgqC   Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2024/02/DIH-2-27-24.pdf Connect with us on socials: https://www.abor.com/socials Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey Have feedback? Email us at [email protected].