If you’ve been waiting to buy a home in Austin, whether you’re hoping for prices to drop or for interest rates to come down, now is the time to act. The next few months—September, October, and November 2024—could offer one of the best opportunities we’ve seen in years. Here’s why.
1. Home Prices Are Down
The first factor working in your favor is the current pricing trend. Based on data from the Austin Board of Realtors, the median home price in Travis County has dropped to about $507,000. This follows the typical seasonal pattern we see in the real estate market—prices rise in the spring, peak in the summer, and start to fall by fall.
If you’ve been waiting for home prices to come down, they already have. Just two years ago, in May 2022, the median home price hit a record high of $659,000. That’s a nearly 30% decrease in price! By buying this fall, you can take advantage of this downward trend.
2. Less Competition During Election Season
Another reason this fall is a great time to buy is the timing of the election. Historically, the months leading up to a presidential election tend to slow down in the housing market. Families are often focused on the economy, government policies, and what changes might be coming, which leads to fewer buyers in the market.
With fewer buyers comes less competition. This gives you more negotiating power, whether you’re purchasing a resale home or a new construction property. Builders, in particular, are offering significant incentives right now because they have a lot of inventory to move. Fewer buyers also means you’re more likely to find a great deal on your new home.
3. Interest Rates Have Dropped
Finally, mortgage rates are lower than they’ve been in months. While many people are waiting for the Federal Reserve’s next meeting in September, mortgage lenders have already started to lower rates in anticipation of a rate cut. Even though the Fed doesn’t directly control mortgage rates, lenders are responding to market conditions.
Rates have already dropped by over a percentage point from where they were in the spring of 2024. For example, if you were looking at a 7.5% interest rate in April, you might now qualify for a rate closer to 6.25%. This rate drop increases your purchasing power. For every 1% drop in interest rates, your buying power increases by about 10%.
If you qualified for an $800,000 home in April, you might now qualify for an $880,000 home. Alternatively, if you stay in the same price range, your monthly mortgage payment would be significantly lower. For instance, on that $800,000 home, your payment would have been around $4,475 at the higher rate. With today’s lower rate, that payment could drop to about $3,941—saving you over $500 a month!
Why You Shouldn’t Wait
Many buyers are still sitting on the sidelines, waiting for rates or prices to drop even further. However, if mortgage rates dip into the 5% range, a lot of those buyers will jump back into the market. More buyers mean more competition, fewer homes to choose from, and ultimately higher prices. By purchasing in the next few months, you can avoid that rush and take advantage of favorable conditions.
Ready to Explore Your Options?
If you’re thinking about buying a home in Austin, now is the time to make your move. Reach out to me with any questions or to discuss your unique situation. I’d love to help you explore your options and find the perfect home.
