Monday, April 13 – Austin Metro Area Real Estate Update
Current Austin Metro Area Inventory
310 new homes emerged on the market in the past 7 days. A 10% decrease from last week which is improved from the previous week.
240 homes went under contract in the past 7 days. A 11.4% decrease from last week.
156 homes sold and closed in the past 7 days. A 34.4% increase from last week.
79 homes withdrawn or temporarily taken off the market. This is a 23.3% decrease in homes withdrawn from the market since last week.
Week-Three “Shelter-In-Place”
FIRST, HOW ARE YOU DOING?
As many of you know I love live theatre so all manner of scenes are playing out in my head about the many ways I hope to connect and check in on you.
They may or may not involve songs from musicals 😁.
In addition to my “right brain” creative tendencies I am also an analytical, data driven person looking for the story in the numbers. So, I’ve been using the metaphoric “both sides” of my brain these past 5 weeks of the COVID 19 outbreak. One side has been texting clients and assembling plans to help people adjust and pivot during this crisis while the other side of me has dug into the data to better understand what we are dealing with so I can help coach and guide clients through it.
What I have learned navigating our market for 5 weeks is this:
1. I sometimes need to step away from the data and visit more.2. Austin is a unique position to recover and has been for over a decade. Our Austin metro is filled with a highly educated workforce. We are an affordable location for startups and entrepreneurs in comparison to other metropolitan cities. We have limited inventory and new construction has not been able to keep up with the housing demand to satisfy the pressing need. What this leads to is an urgent need for housing that not even a pandemic can completely disrupt.
https://www.agentjill.com/covid-19/
Interest Rates & Loan Qualification Changes
As of 1pm on Monday rates were resting at 3 – 3.25% for a 30 year Conventional loan and 2.75% for a 15 year conventional Loan. Refinance rates are between 3.5 & 3.75%.
According to CNBC yesterday “JPMorgan Chase, the country’s largest lender by assets, is raising borrowing standards this week for most new home loans as the bank moves to mitigate lending risk stemming from the novel coronavirus disruption. From Tuesday, customers applying for a new mortgage will need a credit score of at least 700, and will be required to make a down payment equal to 20% of the home’s value.”
Our local preferred lenders are communicating that when big banks make changes like this others often feed on it and make changes so this could trickle down to other lenders in the coming days. Lenders are also starting to see requirements for a longer period of reserves needed to close a loan so that the mortgage provider can be sure the borrower has enough reserves saved up in case of a job loss.
FHA and VA continue to ease standards on home appraisals and employment verification on some loans while conventional loans where buyers place 20% down. Jumbo loans, loans over $510,400, are becoming as rare as Charmin and Purell these days with most banks eliminating them due to risk.
To discuss the mortgage scene with one of our preferred lenders connect with their contact info below.
Mortgage & Money Tips of the Week
Austin Metro Market Overview
For the Agent Jill Team this past week was filled with multiple offers on listings, inspections and safe client visits to homes under contract, virtual staging and buyer consults via video messaging and lots of community and client education. So, “business as usual” activities with “business UN-usual” safety gear and procedures. I certainly don’t mean to make light of this… just my inside perspective on Austin real estate. It is “coordinated circus acrobatics,” as one of my clients called it, but for our clients who have to be in this market we’ll do whatever it takes to keep everyone safe and play our part in flattening the curve.
As for the big picture for Austin real estate in 2020 Mark Sprague, market analyst and area real estate expert for Independence Title, addressed industry professionals this past week in what will now be a regular series through this crisis. Mr Sprague said, “Housing is a positive point of light in Austin. Locally there is not enough shelter/inventory, and real estate will probably have another good year. If builders quit or slow building new homes, that actually causes values to increase in the resale market.”
He confirmed what I have been experiencing in the field and said “Austin has been blessed in leading the nation in so many ways. That has placed stress on the lack of real estate inventory in multiple channels. At this point, sales have not shown any signs of slowing, although leasing has slowed. Recovery depends on the economic strength of your local market. Austin and most Texas metros should rebound quickly due to the low unemployment, need to fill jobs, not enough real estate inventory, etc.” He went on to say that “If the market returns to normal within 30 to 90 days, yes. Longer than that, it becomes a concern economically, because of the disruption and stoppage on revenue to multiple sources. We will have to revisit at that time. As a metro, region and nation, we have shown remarkable resilience in the face of crisis. Presently we have not seen a slowdown in the Austin and regional housing market.”
Agent Jill Team friends… I don’t have a crystal ball… yet. No one knows exactly how all this will play out.
However… all of this analyzing, data research, and discussions with market experts is giving me confidence that the Austin real estate market has a good chance to persevere through this and recover.
I’ve got both sides of the brain working on this and I’ll continue to keep you updated. But for now let’s stay safe, wash those hands, and focus on each other as we support and nourish our community.
