“Is this a good time to buy or sell my home?” It’s one of the questions I am most frequently asked as a Realtor. I always remind my clients that the economy is cyclical and there is no perfect “time” to buy or sell. For the average homeowner, I recommend they buy or sell when they have a reason to do so. Events like marriage, a new baby, divorce, job changes and retirement are all common and perfectly valid reasons why someone might buy or sell.

“But what about the economy? Will house prices crash?” I don’t have a crystal ball, but I have always been bullish on the strength of the greater Austin area. People continue to move to Central Texas and the major counties that make up the Austin metro (Travis, Hays, Williamson, Bastrop and Caldwell) continue to see exponential growth. Georgetown, located north of Austin in Williamson County, was just named the fastest growing city in the United States for the second year in a row, according to the Austin Business Journal.

That said, house prices are somewhat lower this year compared to last year—but not as drastically as all the dooms-day predictions had suggested. According to the Austin Board of Realtors, the median home price is the Austin-Round Rock MSA was $466,705 in April, a decrease of 15 percent compared to April 2022.

Despite economic uncertainty and interest rates that have doubled, home prices are still relatively high and demand remains strong. Certainly, the frenzied overbidding of the pandemic years has faded away, but homes that are move-in ready and well-priced may still receive multiple offers.

My perspective on this has to do with inventory—or lack of it. While inventory has increased compared to recent years, it still is far less than needed. ABOR reported slightly more than three months of inventory in April, far below the six months of inventory needed for a balanced market.

For those people who purchased or refinanced their mortgages when rates were in the 2 to 4 percent range, it’s hard to justify selling that home only to buy a new one at nearly 7 percent. This has kept many would-be sellers “locked in” to their current homes. At the same time, the job market remains strong, fueling demand.

Nationally, one-third of homes sold above the listed price in the last month and the typical home received three offers, according to the National Association of Realtors. While that is not happening on every home in Central Texas, it is something I see.

Additionally, many lenders I speak with believe interest rates may fall by the end of the year or early 2024, which will likely spark even more demand. If that should happen, it’s likely we will see prices climbing again.

As I stated earlier, all economies are cyclical. Deciding if now is a good time to buy a home or a good time to sell depends on your personal situation and not the state of the economy. If you have questions about the market—whether you are thinking of buying or selling, reach out. I’m here to help.

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