DAYS ON MARKET Since early 2020, the average amount of time it takes to sell a home in the area had been on a steady decline until the middle of last year, when homes began sitting on the market much longer than previously. Cedar Park Leander Georgetown
A DROP IN AFFORDABILITY As the interest rate on a home loan increases, so does a homeowner’s monthly mortgage payment. The following graphic details how much a homebuyer can afford at various interest rates based on a capped monthly payment.
100
80
• 30-year fixed loan • $1,200 annual insurance payment • $2.5% annual tax rate FIXED VARIABLES
60
40
20
INTEREST RATE
HOME PRICE FOR MONTHLY PAYMENT OF $2,780
0
Jan. 2020
Jan. 2021
Jan. 2022
Jan. 2023
3%
$400,000
3.5%
$388,800
SOURCE: AUSTIN BOARD OF REALTORS/COMMUNITY IMPACT
4%
$373,500
4.5%
$359,100
Slowing, not stopped While bidding wars have stalled and sales have eased up, continued growth is still expected. As major companies such as Samsung move into the area and ancillary businesses to support the tech giants pop up, the available jobs will continue to attract people to the region. “Employers from around the country are looking at coming to Central Texas, and they’re finding a great talent pool up in Georgetown and in Williamson County,” said David Porter, execu- tive director of the Williamson County Economic Development Partnership. With roughly 75,000 Georgetown residents in 2020-21, according to U.S. census data, projections from Georgetown’s Planning Department have the city’s population rising to 89,000-110,000. Catlin said the growing population and influx of new employment opportunities will continue to spur the housing market. So despite some homeowners sitting on the fence and waiting for the right moment to buy or sell, others will need to find a place to live sooner rather than later. “A lot of people say all the sales happen during the summer because that’s when kids can move, but maybe a third of the homebuyers are families with
have a couple of options to get the best deal for a new home, such as buying with a plan to refinance their mortgage when rates fall. “If you wait too long, the circumstances may be somewhat punitive,” said Russ Phillips, a Georgetown real estate agent at Russ Phillips Team. “When interest rates come down, you can always refinance, but if you waited six months and interest rates came down, but prices went up, and it totally offset that, then you haven’t done yourself any favors.” Interest rates often mirror inflation as the Federal Reserve tries to curb price growth. However, economists and investors will also be looking closely at 10-year U.S. Treasury notes as they are used as a benchmark that guide other consumer rates. Another mechanism becoming popular among lenders, a two-one buy-down loan, allows for reduced mortgage payments for the first two years of a loan. Catlin said this is a tool homeowners who are having a hard time selling their house might entertain. “They accept an offer, and part of the offer is that the sellers will contribute to buying down the [interest] rate for a period of two years,” he said. “That’s going to allow you to take advantage of a lower rate that doesn’t exist now and then refinance on a permanent basis within two years of closing.”
5%
$344,700 $319,500 $332,100
5.5%
6%
SOURCE: WWW.MAXLEAMAN.COM/COMMUNITY IMPACT
children that that would affect,” Catlin said. “So we tend to pick up in March, and then it goes kind of crazy, relatively speaking, for the year.” Home sales will likely peak around the Fourth of July, he said. Before then, interest rates, infla- tion, supply chain disruptions, construction costs and more will continue to influence the housing landscape. Maneuvering through these economic factors, meanwhile, will remain difficult for buyers and sellers. “If you’re looking to time the market, you’re going to have to be lucky because it’s not a skilled thing,” Catlin said.
For more information, visit communityimpact.com .
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COLORADO VALLEY QUILT GUILD PRESENTS The 25th Annual “BEST LITTLE QUILT SHOW IN TEXAS”
Friday, February 24th & Saturday, February 25th • Admission $10
La Grange Community Center (K C Hall) 190 S Brown Street • La Grange, TX 78945 www.coloradovalleyqg.com
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Donation Quilt Drawing
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GEORGETOWN EDITION • FEBRUARY 2023
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