Quick Thoughts

• It’s not uncommon for January to be a slow month
• Pending sales are in a much better place looking at February
• Prices have stayed in the $230,000-$250,000 median range since April of 2022

Mortgage Rates

Mortgage rates are expected to remain in the low 6% range for most of the year. There is a pullback anticipated to occur in the back half of 2023 where we might see rates closer to 5.5%. However buyers should not expect any significant changes up or down. Take a look at the quick thoughts below from one of our National Association of REALTORS economists.

There is plenty of opportunity in the market, it’s just a normal market. Sellers have to reign in their expectations and buyers have to embrace slightly higher mortgage rates while getting to enjoy a balanced market. Mortgage rates are still some of the lowest they’ve been in the past 20 years.

With property rental rates being at an all time high there are many paths to home ownership! Give us a call at (325) 695-8000 to be connected with one of our residential specialists to discuss the various options to get you in a home. It’s a great start to building wealth, and to avoid paying 100% interest on your rental!

The market is changing, and the wild ride of the past two years is over.

Quick Thoughts

• The closed sales decline should be taken with a grain of salt. A slowing market happened right as the holidays began which are a historically slower time.
• Annually closed home sales for Abilene are down just over 8% which is a better metric to work with.
• Inventory has increased drastically in the last half of 2022.
• Prices have remained mostly flat since April, and are expected to remain so for most of 2023.

Seller Expectations

The sweet ride for sellers is over. An important aspect of the rising inventory is also how many new construction homes that are on the market. Your home value is always competing against what buyers can acquire in the new construction market, and they’ve got a lot of options. As of the time of me writing this there are 95 new construction homes sitting active on the market! The lower end price of these options is still in the $225,000-235,000 range.

As a seller you need to take your REALTOR’s advice to heart. You need to be hyper aware of what your pre-existing home offers when a buyer could go buy a brand new everything home for $230,000.

Buyers overwhelmingly show they prefer homes that need little to no work. Why is that? Remodeling is expensive, stressful, and can be difficult. Like many other things in the world supplies are more expensive, schedules are longer, and labor is more expensive. You can spend $20,000 updating a home much quicker these days than you could a few years ago. That is a crucial aspect of pricing your home against new construction when you consider the cost, and hassle, it would take to complete those updates.

It’s a different market, and you need a REALTOR who can give you the good data and advice. Seller concessions can play a crucial role in this, and having a REALTOR who can help you navigate which concessions are the most effective is equally important.

Buyers Get Relief, but Affordability Issues Remain

Getting qualified for a loan can still be a huge barrier for buyers. Rising interest rates, increased cost of living, and tighter lending requirements all play a factor here. The affordability of housing is becoming increasingly more of a problem combined with the price increases of homes the past two years.

Buyers, in most cases, no longer have to worry about trying to see a home the first hour it hits the market to put an offer in. Home buyers are not often having to submit prices significantly above asking price and/or waiving their due diligence items.

For the buyers that can get qualified for a mortgage the market is a much less stressful one. There are still areas with inventory shortage, but it’s much less than it has been.

Looking to 2023

• Interest rates are expected to remain in the low 6 range for most of the year.
• Prices are expected to remain mostly flat.
• Number of sales is expected to slightly decline, which we’ve already seen begin.
• Sellers have to adjust their expectations.
• Buyers need to be diligent in managing debt and not buying more than they can really afford.
• See the annual housing recap for 2022 below!

Until next time!

Shay Senter – President BHGRE Senter, REALTORS

Quick Thoughts

• November is historically a slower month, and overall home sales were very low
• The lower median sales price is largely a factor of the limited volume
• Interest rates peaked during November which impacted buyer activity

Moving Forward

• Interest rates have pulled back, and are expected to stay closer to 6% moving forward
• Prices are expected to remain mostly flat in 2023
• Total number of sales is expected to decline

Interest Rate Buy Downs

This is a powerful tool for buyers. Seller concessions are becoming increasingly common again as the housing market returns to a more balanced position. An interest rate buy down is an option you should discuss with your REALTOR and lender when writing your offers. This is the absolute best way to reduce your monthly mortgage payment. A typical concession cost can result in $300-500 reduction in your monthly payment. This is looking at average and slightly above average home prices in Abilene, TX.

There are additional options that can be more short term. The benefits of this would be looking at refinancing in a few years, or even if you might move in a shorter period of time.

With interest rates being so low for several years before this recent rise this tool hasn’t been used in a while. We believe it is highly effective and our team of Abilene REALTORS are here to answer your questions and guide you through the process.

Happy Holidays!

The Better Homes and Gardens Real Estate Senter, REALTORS team is thankful this holiday season. We’re thankful for our amazing team, our wonderful clients, and to have called Abilene home for over 65 years now. The donations and support we’ve been able to give back over this holiday season are only possible because you choose to trust us with your business.

There’s never been a more important time to have an experienced expert on your side. Give us a call if you have any questions about homes or commercial real estate in Abilene, TX!

Merry Christmas!

–Shay Senter – President, BHGRE Senter, REALTORS

Well yes, I do believe the market has changed.

The Highlights

• Prices continue to remain flat since April.
• Prices are expected to remain mostly flat through 2023. With a potential to rise ~3%. There is also potential for prices to drop 5%.
• There is no data to remotely support any kind of “crash” occurring.
• Interest rates are expected to remain in the current 6.5-7% range for several months if not most of 2023.
• We’re still looking for the 3 months inventory level that is considered a healthy market.

Moving Forward

We’ve spoken at length about adjusting expectations in the past several months blog posts. I won’t rehash that today. The market has returned to a more balanced and normal state. It’s going to take a little longer for most homes to sell now. They aren’t going to be selling much above asking price. Buyers can look at a few homes before making an offer. It’s the market we worked in for a long time before the past two years. It’s still a good time to buy or sell property in Abilene, TX. Life continues on, and the market is stable. You aren’t going to miss a big upswing in prices if you are trying to sell. You aren’t going to miss any big downswing as a buyer.

By working with a local expert who is studying the data, knows Abilene, and has experience through these kinds of market changes you can make good transactions. You can be confident in the investment of this large asset. Our team at BHGRE Senter, REALTORS brings our 65 years of experience serving the Abilene residential and commercial real estate markets to bear to help our clients make informed and confident decisions. Contact Us to get connected with a professional today.

Industry Thoughts

Several large public real estate companies reported earnings recently, and there were a lot of losses. There is no doubt that there are challenges ahead for REALTORS and the companies in the real estate sector. My big takeaway here is to be cautious of companies you never heard of before the past 2-3 years. The state of the market allowed things to take place that aren’t sustainable, and business models to exist that won’t function moving forward. When you work with that REALTOR you need to ask yourself are they going to be here in a few years when I need them again? 65 years of Senter, REALTORS. 100 years of Better Homes and Gardens. That’s the legacy we bring to the table. Tested, established, and trusted. We’ve served your families and businesses for generations and will continue to do so. In a real estate market that is ever changing let us be the constant you can count on!

Until next time!

Shay Senter – President & Owner, BHGRE Senter, REALTORS

The market is changing. Having professional, local, and full-time guidance to guide your real estate decisions is more important than ever. Interest rates have risen more than expected, and positive inflation news remains aloof. The inventory recovery continues to be strong as we get closer to returning to three months of available inventory. Home prices have remained flat since April of 2022.

Seller Reality Check

For a vast majority of sellers the market is in a mostly balanced state. Still slightly favoring sellers, but it’s changed dramatically from what we’ve all been experiencing for the past year. In the Abilene market we’ve seen approximately 15 price reductions come through the MLS every day. If you aren’t adjusting to the new normal and discussing your price with your REALTOR, you need to be! As cost of living continues to rise, higher interest rates increase mortgage payments, and continuing to work with record high housing prices has cooled the insane demand that fueled most of 2022.

Sellers need to expect to make a few more concessions. Some common examples are offering to pay for that home warranty or pay some buyer closing costs. Updates throughout the home have only become more important as the buyer demand has dwindled and buyers continue to show a very strong trend in preferring move-in ready homes. Contractor and general employment shortages continue to pose challenges to the remodel market, and for those buyers who are willing to take on a “fixer upper”. The hot market has left us, for now, and until things change with interest rates and cost of living you can expect the market to remain cool.

I would remind anyone reading this that BHGRE Senter, REALTORS offers upfront, no fees, funding for various home remodel projects when you list your home with us. Several thousands of dollars of funding, a project coordinator, and you just pay at closing! It’s one of the many benefits we offer our clients to get the most profit for your home. Contact us to learn more about this program.

Buyer Relief

For both agents and buyers life is easier. The amount of multiple offer situations has declined drastically. Buyers aren’t having to make offers sight unseen or waiving all of their due diligence items. It’s simply a normal market. This is not to say buyers are without unique challenges of their own. With inflation and interest rates the way they are many buyers are finding themselves unable to afford a home they could have afforded a few months ago. The average mortgage payment has increased by approximately $700 per month since last year due to rising prices and interest rates. That’s a large expense increase for most families!

The Bottom Line

It’s still a good time to be in the market to buy or sell. For buyers, if you know you’re going to live in that home for at least 3-4 years then becoming a home owner to start that path of equity and wealth is still a solid plan. Rent prices have seen similar levels of increase, and interest rates are expected to go down eventually. Whenever that occurs you can refinance your home to take advantage of those lower rates in the long term. Date the rate, and find a home you can enjoy. If you are going to be a short term buyer there is a very strong case to just keep renting as the costs associated with selling your home make it a difficult case to be in your favor.

Sellers still get to enjoy unprecedented amounts of equity in most cases. While homes are sitting on the market a little longer than they used to you will walk away from the closing table with a lot of profit to pursue your next dream. Taking the few extra steps to perform a few high impact updates, and making sure house shows well can make a big difference in this new market.

The market is changing, and data has to be accounted for every week! It’s never been more important to have a full-time and local expert to offer you guidance and advice on your real estate goals. Trust in our 65 years of experience, our local expertise, and high producing REALTORS to get the most out of your real estate transactions. Reach out to the office, or your favorite BHGRE Senter agent, for a free consultation on your current needs.

Until next time!

-Shay Senter – President BHGRE Senter, REALTORS

A Changing Market

The market is changing. The heavy seller’s market we experienced for a good 15 months is no more. It is still a seller’s market, but not drastically so. Demand has dropped significantly due to inflation, rising cost of living, and mortgage interest rates continuing to rise. The median sales price remains largely unchanged since late March. I wanted to share some insight from NAR chief economist Lawrence Yun that provides a good viewpoint on these issues and how they are impacting the housing market and overall economy.

Still A Good Time to Buy

While housing affordability has become a significant issue if you can afford to buy it’s still a good time to do so. It’s important we remember there is essentially no data to suggest a pullback in housing prices. In fact, all data points to housing prices continuing to rise at much more normal rates of 3-5% annually. Interest rates are expected to increase in the short term, but with very little volatility. The odds are good that if you tried to wait for a slightly better interest rate the increase in housing prices over the course of several months would eliminate any potential gain. I encourage buyers to buy now if they are able and find a home they love. If interest rates change significantly in a few years you can always refinance.

Seller Expectations

The amount of equity in a vast majority of homes has never been higher. You will still get the highest price for your property in history. However, it can take a little bit longer to sell. While homes can still sell quickly I would encourage sellers to begin to plan for 2-3 months of marketing time in most situations, and still expect a 30-45 day closing period after that. Doing some work upfront to improve the curb appeal, fix minor repairs, and make sure the home shows well have also become more important. Demand has decreased slightly, and there are more homes on the market than there has been in almost two years!

As the number of listings continue to increase you need to ask how is your property standing out? Do you have good photos? What kind of advertising campaigns are being run for your property? Is your agent working to get feedback, and being available to answer questions as buyers get more patient and inquisitive? Factors that have mattered less these last two years are now important again as this market shifts back to something that is mostly normal. Reach out to any of our Roadrunners who you can find here: https://senterrealtors.com/our-agents for a free consultation on your home value, determine your equity, and the market conditions for your neighborhood.

Until next time!

-Shay Senter – President BHGRE Senter, REALTORS

Inventory Recovery!

For the first time since October of 2020 we have over 2 months of housing inventory available. This is mostly fueled by a surge in homes being put on the market, but also by a slight decrease in home buyer demand. The factors we’ve been talking about for months with increased prices, rising rates, and economic conditions reducing the number of buyers in the market are all playing out as expected.

There’s not much else to say this month. Prices have remained mostly flat since April, and are expected to remain so through the end of the year. Marketing times are still down though starting to rise as more homes sit on the market for longer. It’s going to be important for sellers to keep expectations in line with reality as the market returns to a more balanced position. Overpricing your property is still one the easiest ways to hurt your final return and you need to listen to your REALTOR and dive into the latest data for your neighborhood!

Mortgage rates have decreased slightly, and there is not expected to be much variance through the end of 2022.

Until next time!

-Shay Senter, President BHGRE Senter, REALTORS