October 22, 2024 | Driving It Home with ABoR's Housing Economist

In this episode of Driving It Home, Dr. Clare Knapp and Kelea Youngblood discuss the recently released September Housing Report, focusing on the real estate trends in the Austin market. They begin by addressing the headline numbers, highlighting a slight 3% decline in closed sales and a 7% drop in median sales prices, now sitting at approximately $425,000. Despite these declines, Dr. Knapp emphasizes that mortgage rates have dropped from 7% in early July to around 6% at the end of September, yet sales were affected by buyers delaying purchases, likely anticipating further reductions in rates. The conversation then moves to the sharp 20% increase in pending sales in September. However, Dr. Knapp notes that October sales activity has seen a 17% year-over-year decline. She attributes this to buyers expecting further rate cuts after the Fed's rate cut in mid-September, which did not materialize as rates began rising again. Sellers may need to adjust their expectations, with Dr. Knapp suggesting that home prices might need to come down by about 10%—bringing the median below $400,000—to reignite buyer interest amid higher rates. Finally, they touch on inventory levels, with active listings up 12%, though lower than earlier in the year when it saw spikes up to 50%. The average close-to-list price ratio is hovering just below 93%, indicating that sellers may still have some room to negotiate. As 2024 approaches, the market is expected to remain slow, with mortgage rates likely staying in the low-to mid-6% range, keeping affordability and buyer demand constrained. Links Mentioned https://www.abor.com/unlockstats https://www.abor.com/marketstatistics   Listen On: Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732 YouTube: https://www.youtube.com/playlist?list=PLzH_caxJ3VPq5iExWilqZOahnREgSFgqC  Connect with us on socials: https://www.abor.com/socials Connect with Dr. Clare Knapp on LinkedIn: https://www.linkedin.com/in/clare-losey  Have feedback? Email us at [email protected]. Download an Episode Transcript: https://www.abor.com/content/uploads/2024/10/DIH-10-22-24.pdf