In this episode of Driving It Home, Dr. Clare Losey and Emily Chenevert discuss the current state of housing affordability in Austin. Dr. Losey outlines the critical factors influencing affordability, including mortgage rates, home prices, and household income. Despite some moderation in home prices and slight wage growth, the increase in mortgage rates over the past two years has significantly reduced affordability. A household earning $100,000 now can afford a home priced at 3.1 times their income, whereas, a couple of years ago when mortgage rates were around 3%, the same household could afford a home priced at four times their income.

The conversation moves on to the practical implications for buyers and real estate agents. Despite the market changes, high prices relative to buying power remain a challenge. Dr. Losey advises that a buyer needs to earn between $90,000-$100,000 to enter the Austin market meaningfully, but even at this income level, there is a shortage of affordable homes. They discuss the role of agents in navigating these challenges, including leveraging creative financing options and utilizing resources like the Down Payment Resource in Matrix to help clients.

Finally, they review the current market trends, indicating that January's trajectory seems similar to the previous year's, with a slight decrease in closed and pending sales and new listings. Dr. Losey suggests that the market is still adjusting to mortgage rate changes and anticipates no significant shifts in the coming months. They end the podcast by teasing topics for the next episode, including upcoming economic reports that might influence Fed rate decisions, and promote ABoR and Unlock MLS’s Annual Meeting on January 31, that will provide further insights into the housing market and legal updates.

*Links mentioned in this episode:* January 31 Annual Meeting https://www.abor.com/event-type/annual-meeting 

YouTube: https://www.youtube.com/@AustinBoardofREALTORS/podcasts 

Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732 

*Don't forget* to access your *FREE* Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights. 

Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2024/01/DIH-1-23-24.pdf 

Connect with us on socials: https://www.abor.com/socials 

Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey 

Have feedback? Email us at [email protected].

In this episode of Driving It Home, Dr. Clare Losey and Emily Chenevert discuss the latest Consumer Price Index (CPI) report and its implications on the economy and inflation. Dr. Losey notes a slight increase in the CPI from November to December, with a rise from 3.1% to 3.4%, suggesting that reaching the desired 2% inflation rate might take longer than anticipated. She emphasizes that the Federal Reserve is looking for sustained decreases in inflation rather than a specific target before considering interest rate reductions.

The conversation shifts towards the housing market, with a focus on mortgage rates and their impact on consumer decisions. Dr. Losey advises agents and consumers to recognize the value in the current market, despite recent fluctuations in interest rates. She highlights that mortgage rates have decreased from their peak in the fall of the previous year, presenting opportunities for buyers and sellers. December's market statistics are analyzed, showing a stable median sales price, a 9% decrease in closed sales, and an increase in inventory, suggesting a modest performance for the market in 2023.

The podcast concludes with a discussion on leasing data. They report a strong week-over-week increase in closed sales and pending leases, but a decrease in closed leases, which is typical for the beginning of the month. 

*Links mentioned in this episode:* 

January 31 Annual Meeting

https://www.abor.com/event-type/annual-meeting

December 2023 Market Statshttps://www.abor.com/marketstatistics

YouTube: https://www.youtube.com/@AustinBoardofREALTORS/podcasts

Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732

*Don't forget* to access your *FREE* Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights.

Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2024/01/DIH-1-17-24.pdf

Connect with us on socials: https://www.abor.com/socials

Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey

Have feedback? Email us at [email protected].

In this episode of Driving It Home, Dr. Clare Losey and Emily Chenevert discuss the labor market outlook for 2024. Dr. Losey suggests that although the labor market is expected to cool down, this is not necessarily a negative development, as it could help alleviate some inflationary pressures. The cooling refers not to job losses but to a slower pace of hiring, which could result in a less competitive job market. They note that the Austin labor market reflects a similar trend, with unemployment at a historic low and job growth easing compared to the recovery highs post COVID-19.

They also touch on the concern of wage growth in Austin not keeping up with the housing costs, which poses challenges for affordability and accessibility. However, they highlight that the deceleration in home price increases may offset slower wage growth. The conversation then shifts to week-over-week market stats, where closed sales dropped significantly, which Dr. Losey attributes to the timing of the holiday season rather than an overall trend.

Finally, Dr. Losey and Emily Chenevert end the podcast with a reminder for listeners to stay tuned for future statistics and a deeper dive into Austin's residential real estate expected at the January 31 Annual Meeting. They also mention the resumption of school for Austin ISD, hinting at a return to normalcy and possibly more activity in the housing market, alongside a joke about the lighter traffic enjoyed during school holidays.

*Links mentioned in this episode:* 

January 31 Annual Meeting

https://www.abor.com/event-type/annual-meeting

YouTube: https://www.youtube.com/@AustinBoardofREALTORS/podcasts

Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732

*Don't forget* to access your *FREE* Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights.

Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2024/01/DIH-1-9-24.pdf

Connect with us on socials: https://www.abor.com/socials

Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey

Have feedback? Email us at [email protected].

In this episode of Driving It Home, Dr. Clare Losey and discuss economic predictions for 2024, zooming the lens in on the housing market. Both express cautious optimism for the year, noting the previous year's market shifts, particularly the effects of higher mortgage rates and market adjustments post-pandemic. Dr. Losey predicts that while mortgage rates are expected to decrease gradually, they will likely not drop enough to significantly stimulate refinance activity, although a decline would increase homebuyers' purchasing power.

Dr. Losey offers a nuanced outlook on home prices, expecting them to remain relatively flat, with possible variations of 3-5% up or down, considering the high mortgage rates and elevated home prices since the pandemic. The housing market is still deemed competitive, and the stability in prices would maintain the value for sellers. They also discuss the effects of the upcoming election on the 10-year treasury yield, which could introduce volatility affecting mortgage rates, though any effects are expected to be short-term.

The conversation also touches on the housing market sales, which are anticipated to be flat compared to 2023, influenced by the market's adjustment to post-pandemic conditions and a higher rate environment. Dr. Losey explains that the COVID-19 pandemic led to anomalous market behavior, which is now stabilizing. They speculate on the impact of local regulatory changes on housing supply, particularly in Austin, with the HOME Initiative allowing for more housing units per parcel. The slow pace of construction and the complexity of development regulations temper expectations for rapid changes. They conclude that 2024 could be a more predictable and potentially favorable year for first-time buyers, with more stability and less volatility in the housing market.

Links Mentioned

https://www.abor.com/research

Email us at [email protected]

YouTube: https://www.youtube.com/@AustinBoardofREALTORS/podcasts

Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732

Don't forget to access your FREE Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights.

Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2023/12/DIH-1-2-24.pdf

Connect with us on socials: https://www.abor.com/socials

Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey

Have feedback? Email us at [email protected].

In this special-edition video episode of Driving It Home, Dr. Clare Losey and Emily Chenevert reflect on the past year, marked by economic volatility and a difficult mortgage rate environment. They discuss the fast rate hiking cycle, the most aggressive in four decades, which has led to a decline in affordability for homebuyers.

Despite the last rate hike in July, there is optimism for potential rate cuts in 2024. The conversation highlights the challenges faced by real estate agents and their clients navigating these changes, as well as the dichotomy between a slowing market and the persistent shortage of affordable housing, particularly in Austin.The year 2023 is characterized as a "perfect storm" with high mortgage rates, elevated home prices, and a rapid adjustment to post-pandemic conditions. 

Dr. Losey notes the affordability constraints in Austin, where the housing shortage is particularly acute for first-time buyers. Despite the harsh economic climate, Dr. Losey and Emily are optimistic. Dr. Losey will be back on January 2 for the first episode of the new year to further discuss industry predictions ahead.

YouTube: https://www.youtube.com/@AustinBoardofREALTORS/podcasts

Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732

Don't forget to access your FREE Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights.

Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2023/12/DIH-12-19-23.pdf

Connect with us on socials: https://www.abor.com/socials

Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey

Have feedback? Email us at [email protected].

In this episode of Driving at Home, Dr. Clare Losey and Emily Chenevert discuss the local job market in Austin, with a focus on a recent jobs report. Dr. Losey notes a year-over-year job growth of approximately 3%, indicating a resilient labor market, albeit with growth rates lower than previous months. She explains that the market is stabilizing post-pandemic and is no longer in a recovery phase, which had previously led to exorbitant job growth.

In this episode of Driving at Home, Dr. Clare Losey and Danielle Hammett discuss economic indicators relevant to the housing market. They focus on the Personal Consumption Expenditures (PCE) Index, a measure of inflation, and labor market statistics in Austin. Dr. Losey shares that the PCE Index, which excludes food and energy prices, showed a year-over-year increase of 3.5% and a month-over-month rise of 0.2%, aligning with consensus expectations. This trend indicates that the Federal Reserve might conclude its rate hikes and possibly reduce rates in 2024.

In this episode of Driving It Home, Dr. Clare Losey and Kelea Youngblood discuss the impact of higher mortgage rates on new home construction. Dr. Losey explains that increased mortgage rates discourage builders due to higher borrowing costs and the potential decrease in demand from buyers challenged by affordability. Despite this, the Austin market has seen a slight rebound in new single-family home construction permits, suggesting a cautious optimism among builders who anticipate a normalization of mortgage rates.

Comparatively, the Austin market is doing slightly better than the national average in terms of new construction. This discussion transitions into the broader topic of homebuilder confidence, which has been declining in the face of rising mortgage rates, reflecting a pessimistic outlook on the new home market. However, Austin's year-over-year increase in new single-family permits indicates a relatively stronger market performance.

The podcast also addresses the costs of construction goods and services, which have risen significantly over the past several years. Despite a recent flattening of these costs, they remain high, which, coupled with higher mortgage rates, further constrains the affordability of new homes. The need for affordable housing is particularly acute in Austin, and both Dr. Losey and Kelea stress the importance of advocacy efforts to manage development fees and costs to ensure housing availability for all income levels. They conclude with a brief update on the weekly real estate statistics for Central Texas, noting a significant decline in closed sales and leases due to the Thanksgiving holiday, but with active listings remaining stable. 

Links mentioned in this episode:

Truth About Austin's Missing Housing Report https://www.abor.com/thetruth 

Central Texas Housing Development Fees Analysis https://www.abor.com/document/2022-central-texas-housing-development-fees-analysis 

The Driving It Home is now an official podcast, and you can tune in via ALL major podcasting platforms! 

Don't forget to access your FREE Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights. 

Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2023/11/DIH-11-28-23.pdf 

Connect with us on socials: https://www.abor.com/socials 

Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey 

Have feedback? Email us at [email protected].

In this episode of Driving at Home, Dr. Clare Losey and Emily Chenevert discuss recent economic indicators, particularly consumer spending and costs, as measures of inflation. The Consumer Price Index (CPI) for October was unchanged on a month-over-month basis and showed a 3.2% rise year-over-year, which the market viewed positively, leading to a rally in stocks. Market participants, using tools like the CME FedWatch, now largely anticipate that the Federal Reserve will not raise interest rates in December. Producer Price Index (PPI) figures were also mentioned as being essential because they affect consumer prices if business input costs change. 

Dr. Losey explains that both CPI and PPI figures remained relatively flat, with the cost of single-family residential construction goods and services showing a slight deceleration year-over-year. The cost of construction goods and services has significantly increased compared to pre-pandemic levels, emphasizing the sustained high cost of new home construction. Also discussed were labor costs in construction, highlighting shortages in specialized trades and the importance of advocacy and training to support these high-paying professions. 

The episode concludes with market expectations, anticipating steadier market conditions leading into the holiday season with no significant news expected to cause fluctuations. They also report on market data, noting a strong finish in closed sales and an anticipated decline due to the holiday season. 

*Links mentioned in this episode:* 

https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html 

https://www.abor.com/advocacy

The Driving It Home is now an official podcast, and you can now tune in via ALL major podcasting platforms! *Don't forget* to access your *FREE* Austin Business Journal subscription! Tap into this benefit exclusive for ABoR members and use it as a resource for lead generation and market insights. 

Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2023/11/DIH-11-21-23.pdf 

Connect with us on socials: https://www.abor.com/socials 

Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey 

Have feedback? Email us at [email protected].

In this week’s Driving It Home episode, Dr. Clare Losey provides a summary of what happened in the market for October. Dr. Losey notes a decrease in median sales prices both year-over-year and month-over-month, while closed sales have increased, suggesting buyers are still active in the market, but sellers must adjust pricing expectations. Despite recent declines, prices remain significantly higher than in previous years, indicating a still-elevated market.

Dr. Losey highlights that the total dollar volume of sales is relatively stable, with only a slight year-over-year decrease. Active listings have increased by approximately 5%. They delve into the bigger picture of the 2023 housing market, emphasizing the impact of mortgage rates from previous months on current sales and the resilience of buyers despite rising rates. There has been some moderation in the decline of median sales prices as the year has progressed, and inventory remains low compared to demand.

Finally, the conversation shifts to ABoR's ongoing research, including the recently released part two of the Truth About Austin’s Missing Housing report on the housing shortage in Austin and Travis County, broken down by council districts and racial/ethnic groups. The report shows a significant shortage of affordable homes, particularly affecting Black and Hispanic/Latino households. Dr. Losey suggests that REALTORS® use these findings to educate clients about homeownership challenges and to advocate for policies promoting affordable housing. The episode concludes with a weekly housing market recap, noting a dip in closed sales and a rise in closed leases, indicating a shift toward renting amid increasing mortgage rates.

Links Mentioned in this Episode:

The Driving It Home is now an official podcast, and you can now tune in via ALL major podcasting platforms!

Summary + Transcript: https://www.abor.com/content/uploads/2023/11/DIH-11-13-23.pdf