Recent figures from the Mortgage Bankers Association suggest that the worst of the housing industry downturn may be over. For the first time in three years, fewer homeowners are falling behind on their mortgage payments; this spells good news for mortgage lenders as well as borrowers. While economists hesitate to say that the worst is over, the reduction in new delinquencies is generally regarded as a positive sign by housing industry experts and real estate agents throughout the country. Even in Austin, where housing prices remained surprisingly resilient throughout the nationwide woes, these figures offer fresh hope that an economic upturn is on the way.
Current national figures estimate that fifteen percent of all mortgages are at least thirty days delinquent; this includes homes currently in foreclosure as well as seriously delinquent loans. The worst figures are seen in the subprime mortgage field, where twenty-five percent of loans were thirty days or more delinquent. The state of Texas has fared somewhat better as a whole than the nation, but fifteen percent of the Texas subprime mortgage market loans are seriously delinquent by sixty or more days, and many of these are currently facing or undergoing foreclosure proceedings. Only two percent of all mortgage loans in Texas are currently in foreclosure, which represents a markedly better performance than the national rate of approximately five percent. Texas is one of only seven states currently showing foreclosure rates of two percent of less.
Austin foreclosure rates have remained lower than both the national and state averages, with one percent of loans in foreclosure in December 2009. These low figures will likely shield Austin from the brunt of the foreclosure crisis expected when banks finally begin unloading already foreclosed homes on the housing market. Certain hard-hit regions are expected to see plummeting home prices due to the depreciation caused by this expected glut of homes on the market; as many as six million foreclosed homes may be sold by banks over the next three years, according to economic analysts at Barclays Capital.
The strong housing market and stable home values in Austin make it one of the most desirable places to live in the U.S. Austin’s vibrant computing, healthcare and green tech sectors provide outstanding employment opportunities and have cushioned the Austin metropolitan area against the worst effects of the recession. With mortgage delinquencies on the decline and the national economy showing signs of recovery, there’s never been a better time to consider moving in or moving up in the Austin community.
After a year of sluggish sales, Austin saw a large jump in November '09.
A last-minute scramble to take advantage of tax credits and low interest rates is credited with a 58% increase in Austin home sales in November 2009 over the same period last year. The increase in sales is the largest in over a decade, and offers hope for recovery in the beleaguered residential real estate market. While overall home prices in Austin continue to fall, the decrease has begun to level off and seems to be reaching a state of equilibrium, allowing anxious sellers a well-deserved sigh of relief.
Analysts point to the recently extended First-Time Homebuyer Credit and interest rates that have dipped below five percent as the primary causes for this significant increase in sales. Additionally, while median home prices in Austin have not fallen as sharply as some experts had predicted, appreciable reductions in the asking prices of many homes have led to a surge in bargain-hunting by home buyers who might otherwise be priced out of the market. The median price of a single-family residence in Austin has decreased only two percent over the past year, demonstrating the resiliency and stability of the housing market in the metropolitan area.
Most real estate experts are cautiously optimistic about Austin’s residential real estate market going into 2010. Sales are expected to continue to grow more slowly, with no repeat of November’s record-setting figures. The expansion of the federal tax credit for first-time home buyers and continued low interest rates will likely continue to attract buyers to the market, especially in entry-level communities. However, as the economy begins to rebound, interest rates are expected to return to over five percent, and home sales will slow as a result.
As consumer confidence improves, economic conditions in Austin and throughout Texas are expected to continue to rebound, providing employment opportunities and spurring additional sales of new and existing homes. Home prices are expected to increase as well in correlation with the anticipated growth in demand. With ultra-low interest rates, federal incentives, and the current undervaluing of homes on the market, most real estate advisors believe that now is the time to invest in residential real estate, before interest rates and values return to higher levels later in 2010.
Of the Top 10 places in the country to live, Austin has always ranked high or at the top. This has not changed. The research done at Forbes has once again found Austin tops, in this case it is tops for being one of the best places to stretch your dollar. Austin is number one in the top bargain cities. What you spend here you will get you farther than in any place in the country. This is based on 4 criteria and is out of 50 major metropolitan areas surveyed.
Here are Austin’s rankings and some more Austin accolades:
Regarding best or lowest cost of living, Austin ranks 3 out of 50. For housing opportunities, as in open homes for rent or sale, Austin’s metropolitan area ranks 24 of 50. The unemployment rate they are 1 of the 50 cities, meaning of all the cities surveyed, Austin has the lowest unemployment rate and the most jobs or job growth. Regarding the average salary in Austin, it ranks 20th of the 50 cities. These stats combine to create the best reason for people to love to live in Austin.
As often as Forbes does their surveys, Austin continues to surprise them by topping the lists. From green recognition to best bang for your buck, this is the place to live. Moving to Austin is easier than ever, with the right Realtor. When are ready to move, contact the team here to find your place to live in this wonderful city we call Austin.
April brought some of the biggest gains in the US home buyer market. The number of home buyers who have agreed to purchase a previously owned home took the biggest gains by leaps and bounds in the month of April. Historically, it is the largest jump in previously owned homes since 2001.
Even as the market is moving forward, home buyers can expect prices to continue to fall in different areas around the country. One benefit of shopping for a home in the Austin market is that it has not been a part of the huge pricing swings. Prices in this market are not expected to swing in one direction or the other.
According to the Austin Board of Realtors there were 1,919 pending sales anticipated to close in May, bring the April total up 3%, the highest number since July 2008.
Home prices will increase once foreclosures stabilize again. Currently on the national level, there is still a plethora more homes in the sales inventory base, than home buyers. This is changing, as seen in the evidence from April, and forecasters only expect this trend to continue until the end of the year.
With the growing expectations and the increase in pending home sales, the market is ripe for new home buyers. For 2009 there is available an 8,000 dollar new home buyer tax incentive. This is an increase from the previous 5,000 and in addition to any incentives being offered at the state level. This means that the buyer’s market is reaching its pinnacle in 2009.
Austin’s first quarter is shining bright. As April closes, the Austin residential housing market is seeing markedly less inventory. More homes have sold than have been place on the market. This is one of very few areas in the country to be able to state this. This will soon prove the Austin Real Estate market to be the pace setter to recovery. Some contributing factors include job growth, low interest rates, and the 8 thousand dollar tax rebate.
Some of the factors in the Austin home market improvement is the job growth in the area, coupled with low interest rates on 30 year fixed mortgages and the 8 thousand dollar new home buyer stimulus credit. Austin has seen several companies move into the area, bringing with them a plethora of jobs. This makes the employment opportunities rich, and the housing market viable. As the first quarter comes to a close there are additional job opportunities on the horizon, including several solar energy production companies. As no time line has been committed to yet, job seekers will be following the incoming companies closely.
The hard knocks lesson taught by the housing crash has facilitated the smarter home buyer. This enables people who have been planning and saving for their home to have the best money savings available. Interest rates are hovering around 5% for 30 year fixed rate mortgages, and the 2009 Economic stimulus package included an 8 thousand dollar first time home buyer tax incentive. This breeds more space, more income and more incentive to purchase a home. Austin is proving to be the market of choice.
We are in a very tough economy right now. In the past couple of years, the housing market has been at the forefront of this. Home values have dropped so significantly in some areas, many homeowners face a current mortgage loan worth more than their home. Foreclosures have increased nationwide, and even the Federal Bailout plan has not seemed to help the market as much as expected. Banks have tightened their lending practices and have made it nearly impossible for those with less than perfect credit to purchase a home. Many investors have chosen to stay out of the market as they wait for it to get better. Most experts believe that the national housing market will begin to see increases sometime in 2010. In the meantime, some good news has recently been released in the form of a report stating that pending home sales have actually risen more than 6% since November of last year.
The National Association of Realtors reported that pending home sales for December were at 87.7 for previously owned homes. That is a 6.3% rise from November, the lowest month on record as 82.5. Realtors are hopeful this increase is the beginning of the end of the national market crisis, but do remain aware that the overall economy must also get better to fully pull out of the crisis. It is important to note that these increases were from the South and the Midwest. Pending home sales in the West and Northeast continue to decline. Sales of newly built homes are also low. While several investors are cautiously reentering the market, no one is quite prepared to go all in yet. There is more funding in the Federal Bailout plan that will hopefully help to better the overall market and help to stimulate the economy.
As the country falls deeper into a recession, Austin has remained above many of the staggering statistics. As of the most recent reports, the nation’s unemployment rate has reached above 8%; it’s highest in about 16 years. More than 2 million people have been out of work for more than six months. For many years, Austin has kept a low unemployment rate when compared to the rest of Texas and with the nation. The technology boom here has helped the city maintain the low numbers. Even throughout the worsening economy, Austin has been doing well overall.
In August of last year, unemployment reached 4.5% in Austin. This is the highest it has been since June of 2003. This rate is expected to climb this year as the nation’s economy continues to struggle. It is important to note, however, that even with the increase in unemployment rates, several economic experts believe that Austin will remain above the nation’s unemployment rates. Job growth continues in the city. During the same month, there was a reported 2.4% increase in employment opportunities in the Austin metro area. There have been increases in government and hospitality jobs. Hardest hit in Austin has been the manufacturing industry, which has lost around 2800 jobs in the year.
As the economy weakens, unemployment rates are expected to climb further throughout the country. Austin unemployment rates will most likely climb as well. There are many factors here that should prevent the city from suffering as many other metro areas have. Several businesses still have plans to move here to take advantage of the technology industry and proximity to new graduates from nearby colleges. With incoming employers, the unemployment rate in Austin should remain lower than comparable cities.
About 141,000 people moved to Texas from other states last year, giving the Lone Star State the highest domestic migration figures of all fifty states.
North Carolina, Georgia and Arizona rounded out the top four, according to U.S. Census Bureau figures reported by the Western Blue Chip Economic Forecast.
The Western Blue Chip Economic Forecast is published by the JPMorgan Chase Economic Outlook Center, an affiliate of the L. William Seidman Research Institute, College of Business, Arizona State University.
