Even though the real estate market in Austin Texas continues to be ‘on fire’, a recent report from Redfin shows that home buyer demand is starting to slow.
Their report comes from analyzing search traffic in the recent month plus an overall decrease in mortgage applications and home tours.
Does this mean that we’re getting close to seeing the beginning of the end of seemingly non-stop price increases and demand for real estate in recent years?
The answer to this question depends on whom you ask but the reality is that the stats show that the market is changing.
One key factor that is likely to contribute to the change in home buyer sentiment in recent months is inflation.
Right now, inflation is currently at a 40-year high and it’s only continuing to climb each week so when the cost of living outpaces wages, this could be one central factor that’s beginning to slow home buying nationwide.
Rising Interest Rates
Another factor to take into consideration is rising interest rates.
Homebuyers have had a great run for several years because historically low mortgage interest rates have brought many people to the real estate market and motivated them to buy homes.
With rising interest rates, we may see more people pause their home-buying ambitions as their monthly mortgage payment would make owning a home unaffordable for them.
According to Redfin’s analysis, the monthly principal and interest payment on a home at the median asking price rose to $2,234 at the current average mortgage rate of 4.67 percent. The monthly payment was up 31 percent from a year earlier when rates were 3.18 percent. The average monthly payment for a new mortgage is up to $537 since the beginning of 2022, according to Redfin.
Now is still a great time to buy or sell a property in Austin Texas and I can help you accomplish your real estate goals.
To get started, contact me today by calling (512) 944-7378 or click here to connect with me online.