September 17, 2024 | Driving It Home with ABoR's Housing Economist

In this episode, Emily Chenevert and Dr. Clare Knapp discuss the current state of the Austin housing market. Emily kicks off by mentioning the recent NAR-mandated MLS rules changes, and highlights the recent Market Shift Conversations event that Unlock MLS has been hosting. Dr. Clare Knapp provides a detailed update on home sales and prices, stating that while home sales are down just over 3% and the median sales price is down 2%, the declines are modest overall for the year. However, in August, there was a steeper decline with sales down over 10% and prices down over 4%. Clare points out that while interest rates are lower now than they were last year, buyer affordability remains the biggest challenge in the market. Home prices are still too high relative to the significant drop in buyer purchasing power, which is down around 26-27% from the peak of the COVID-19 housing boom when interest rates were much lower. While average days on the market have remained stable, about 57% of active listings have experienced price drops, with the average price drop around 9-10%, especially for homes priced between $500,000 and $1,000,000. Finally, the conversation shifts to the bigger picture of balancing home prices with buyer purchasing power. Dr. Knapp estimates that home prices would need to drop around another 10% for buyer demand to increase significantly. Emily and Dr. Knapp emphasize the importance of understanding both buyer and seller mindsets, with sellers focused on sale prices and buyers on monthly payments. They encourage listeners to refer to the research document “Rates Are Lower, Where Are The Buyers?” to help frame conversations with clients about the current housing market challenges.   Links Mentioned Rates Are Lower, Where Are Buyers? https://www.abor.com/content/uploads/2024/09/Lower-Rates-and-Purchasing-Power_Downloadable_09-2024-1.pdf Download an episode transcript: https://www.abor.com/content/uploads/2024/09/DIH-9-17-24.pdf   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].