It's a great time to buy real estate in Austin!

Our market has changed in the recent weeks. Some of it was caused by all the rain we had early in the summer. Many buyers were just not motivated to get out and look at properties. And, of course, the disappearance of the subprime mortgage market has had it's impact on the entire mortgage world. Things are correcting themselves and anyone with a stable job, a good credit score and (preferably) a downpayment has no issues obtaining a mortgage. In fact, rates are down (6.09% at the time of this writing - bankrate.com).

Austin's market is healthy and all indications are that it will continue to be - everyone is expecting things to pick up again now that school is back in. However, because of these recent happenings there are more homes on the market and many of them have been out there quite a bit longer than their owners (and agents) had hoped for. The benefit in all of this for buyers in the current market is that chances of negotiating better deals on homes that have been on the market over the summer are generally good. This doesn't mean that buyers should expect drastic reductions, only that those sellers who must sell will now be more open to consider lower offers for their properties.

Often in a shifting market, buyers will ask "shouldn't I just wait...maybe prices will go down?"
The logical answer to that question is simply that we don't know what prices will do. What we do know is that Austin is one of the only markets in the country currently appreciating - average prices are up 6% compared to last July. I believe there is a window of opportunity for buyers in the current market, with a healthy level of inventory and excellent interest rates.

Danny Gallant, Owner/Realtor
The Gallant Group @ Keller Williams Realty
512-922-1273
danny_gallant@kw.com
http://www.gallant-group.com/

How is Austin's real estate market holding up?

I have been asked that question a lot recently. The disappearance of the subprime lending market has affected many lenders who's business models revolved largely around riskier loan products. For some time now, just about anyone could qualify for one type of mortgage or another. Some loans could be obtaining without the borrowers having to prove any kind of gainful employment. Others were initial low interest rate ARMs (adjustable rate mortgages) that would reset to current interest rates at the end of a predetermined term (usually 3-5 years) , often increasing the home owner's payments beyond their means at that point. Various types of interest only loans were also commonplace in markets where home values had appreciated to a point far beyond what was affordable to the median income of it's population. Buyers would take out risky loans with the intent of selling or refinancing their property after a few years of this fast paced appreciation. Unfortunately, many of the rapidly appreciating markets cooled significantly recently, putting a halt on the insane levels of appreciation. Some areas have even seen declining values. Many homeowners then found themselves sitting on a property that they could not sell for what they owed.

This type of lax lending practice was risky for buyers, lenders and mortgage investors. It was bound to come to an end sooner or later. Now that the day has come, however, it seems to be affecting more than just the subprime market.

I believe that is largely due to media sensationalism.

The fact remains that anyone with a stable job, good credit and acceptable debt-to-income ratio
has no problem obtaining a mortgage.

Austin's real estate market remains strong, despite a slight slowdown (July's sales were down 2% compared to 2006). We should not allow the current media hype to paint an unrealistic picture of our market. Greater Austin has seen a healthy level of property appreciation over the last few years and continues to welcome new residents daily. Our foreclosure rate is low (see the "Texas foreclosure rates down" article on this blog), our employment rate is high and our median home price is still one of the lowest out of the top U.S. metropolitan cities.

So my answer to the question "How is Austin's real estate market holding up?"
- Just fine. It's a great time to buy or sell property in Greater Austin!

Danny Gallant - Realtor
512-922-1273
danny_gallant@kw.com
www.gallant-group.com

Austin metro foreclosures down 6 percent in 2007 - 8/22/2007

(Austin) - Foreclosures in the metropolitan area are down 6 percent so far this year making Austin the only major Texas market to show steady improvement in the foreclosure picture. A total of 574 properties in the market are listed for the upcoming September foreclosure auction, down 21 percent from September 2006, according to figures from the Addison-based Foreclosure Listing Service Inc. So far this year, the metropolitan area has logged 4,971 foreclosed properties, down from 5,707 in the first nine months of 2006. George Roddy, president of Foreclosure Listing Service, says Austin is faring far better than other Texas markets like Dallas/Fort Worth and San Antonio where foreclosures are up 12 percent and 5 percent respectively. While Austin is ahead of other cities, foreclosure rates are still on the high-end of the cycle. The 2,627 postings recorded for Travis County so far this year is up 112 percent compared with the same period in 2001. While many want to blame lax lending practices for the current mortgage meltdown, Roddy says there are other factors also at work, including increases in cost of living, rising credit card debt, interest rate increases and the growing difficulty in filing for bankruptcy. Changes in foreclosure filings year-to-date by county are as follows: Travis down 5 percent, Williamson down 9 percent, Hays down 9 percent, Bastrop down 1 percent. [Austin Business Journal]