Some experts believe that the Austin real estate market is headed for a correction that could resemble the one that occurred in the 1980s. There are a number of similarities between the two markets, including:
- High inflation
- Rising interest rates
- Low inventory of homes for sale
- Strong demand for housing
In the 1980s, the Federal Reserve raised interest rates aggressively in an effort to combat inflation. This caused mortgage rates to rise, which made it more expensive for people to buy Austin homes. As a result, home sales slowed and prices began to fall.
Today, the Federal Reserve is also raising interest rates in an effort to combat inflation. This is likely to have a similar impact on the housing market, causing sales to slow and prices to fall.
However, there are also some important differences between the two markets. One key difference is that the housing market in the 1980s was characterized by widespread fraud and predatory lending. This is not the case today.
Another key difference is that the housing market today is much more tightly regulated than it was in the 1980s. This means that lenders are more careful about who they lend to and borrowers are required to meet stricter underwriting criteria. This should help to prevent a widespread collapse of the Austin housing market.
Overall, it is possible that the Austin real estate market could experience a correction in the coming months. However, it is unlikely to be as severe as the correction that occurred in the 1980s.
Here are some things to keep in mind if you are buying or selling a home in the current market:
- Buyers: Be prepared for higher mortgage rates and competition for homes.
- Sellers: Be prepared to price your home competitively and to negotiate with buyers.
- Both buyers and sellers: Be sure to work with a qualified real estate agent who can help you navigate the market.
Rock Properties Realtors® live, work and office in the Austin-Round Rock MSA, near Cedar Park, Georgetown, Hutto, Leander, Liberty Hill, Pflugerville and Taylor. If you are buying or selling real estate, including residential, commercial property or land, Rock Properties will provide you excellent service based on 20 years of real estate experience in and around Williamson County Texas. Call us at 512-850-4510.