January 23, 2024 | Driving It Home with ABoR's Housing Economist

In this episode of Driving It Home, Dr. Clare Losey and Emily Chenevert discuss the current state of housing affordability in Austin. Dr. Losey outlines the critical factors influencing affordability, including mortgage rates, home prices, and household income. Despite some moderation in home prices and slight wage growth, the increase in mortgage rates over the past two years has significantly reduced affordability. A household earning $100,000 now can afford a home priced at 3.1 times their income, whereas, a couple of years ago when mortgage rates were around 3%, the same household could afford a home priced at four times their income.   The conversation moves on to the practical implications for buyers and real estate agents. Despite the market changes, high prices relative to buying power remain a challenge. Dr. Losey advises that a buyer needs to earn between $90,000-$100,000 to enter the Austin market meaningfully, but even at this income level, there is a shortage of affordable homes. They discuss the role of agents in navigating these challenges, including leveraging creative financing options and utilizing resources like the Down Payment Resource in Matrix to help clients.   Finally, they review the current market trends, indicating that January's trajectory seems similar to the previous year's, with a slight decrease in closed and pending sales and new listings. Dr. Losey suggests that the market is still adjusting to mortgage rate changes and anticipates no significant shifts in the coming months. They end the podcast by teasing topics for the next episode, including upcoming economic reports that might influence Fed rate decisions, and promote ABoR and Unlock MLS’s Annual Meeting on January 31, that will provide further insights into the housing market and legal updates.   *Links mentioned in this episode:* January 31 Annual Meeting https://www.abor.com/event-type/annual-meeting    YouTube: https://www.youtube.com/@AustinBoardofREALTORS/podcasts  Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732    *Don't forget* to access your *FREE* Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights.    Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2024/01/DIH-1-23-24.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].