This week I sat in on a presentation by David Tandy, President of Texas National Title. His annual market updates are always well attended because of the wealth of information shared.
He began his presentation by sharing some of the headlines that’s creating confusion.
“U S Housing Boom is Finally Coming to an End, Starting in Dallas”
“Prices are falling in these 7 cities” (Austin was top of the list)
“The Housing Slowdown is Here” (Dallas)
These headlines do not reflect the reality of the Austin market. In fact, our economy and housing market is strong. Very Strong.
David pointed out these realities.
- Population Growth. Texas is the #1 state for growth and the Austin MSA is gaining 151 people…EVERY DAY.
- Job Growth. Austin is #4 in the nation for job growth.
- Low Unemployment. Austin’s unemployment rates is a very low 2.7%
- Unfilled Job Vacancies. In November 2018 there was 40,000 j0b vacancies in Austin.
- Consumer Confidence. Highest level in 18 years.
- Rising home prices. Up 4% in 2018
- Rising Incomes. The Austin MSA has the 5th fastest growth rate among major metro markets.
- Loans with high FICO Scores. The average here is 704.
- Austin MSA is the #2 best performing metro area for gross domestic product.
So, why the worried headlines. Why is there some fear of possible recession? There is one red flag. Nationally, home prices are outpacing income growth and this could lead to a recession.
Yet, in the Austin MSA, that’s not the case. In fact income growth is tracking very well against rising home prices. The median family income here is almost $92,000.
What does all this mean?
- Our total economic market is strong
- Our housing market is strong
There’s also good news for buyers. Last year at this time we were worried that mortgage rates would reach 6.0% in 2018. That didn’t happen. In fact, the Federal Reserve has pumped the breaks on rate increases. It’s possible to get a 30 year mortgage for less than 4.5%. That’s bringing buyers into the market.
On the other side of the deal, Sellers are happy with the appreciation rate they are seeing.
If you have a real estate need, please give me a call at 512-516-4666.
