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Abilene Housing Insights: September 2024
As we head into the fall months, Abilene’s housing market continues to evolve, and both buyers and sellers are seeing opportunities. Here’s a breakdown of what we’re seeing in the local market as well as insights from national trends.
Inventory Levels: What’s Happening?
Inventory levels in Abilene have reached new highs, climbing from 3.9 months back in March 2024 to 4.9 months in September. This increase in supply is due to both a rise in listing activity and a slowdown in buyer demand. While it may sound like a challenge, this shift represents a more balanced market, giving buyers more options and time to make decisions, while also signaling to sellers the need for strategic pricing and expectations.
If you’ve been hesitant to make a move, now is a great time to reassess whether buying or selling fits your needs. Our expert team at BHGRE Senter, REALTORS® is here to help guide you through these changes and ensure you have all the information necessary to make the right decision for your unique situation.
National Mortgage Rate Insights
Understanding the larger economic factors affecting mortgage rates is crucial for anyone buying or selling. Here’s a summary of the key points from recent articles and expert insights:
- Mortgage Rates, October 2024: While mortgage rates have fluctuated throughout the year, they are currently more than a full point lower than this time last year. According to the National Association of REALTORS® (NAR), despite some upward pressure on rates recently, there’s hope that we’ll continue to see a decline as we close out 2024. Current forecasts predict mortgage rates to hover around 6% by year’s end, potentially dropping to 5.8% in 2025 .
- Key Takeaway: Mortgage rates may not be as low as we saw in 2020-2021 (when they dipped below 3%), but they are still much better than recent highs. Many homeowners are refinancing, while buyers are still finding opportunities.
Fed’s Influence on Mortgage Rates
There’s a common misconception that the Federal Reserve directly sets mortgage rates. In reality, while the Fed influences rates, mortgage rates largely follow the yield on 10-year Treasury bonds. This year, mortgage rates have fluctuated due to expectations around the Fed’s decisions, but have settled into a more predictable range. While 3% mortgage rates are likely a thing of the past, the current outlook suggests that rates will hover between 5.5% and 6% as we move forward into 2025 .
Jobs Data and Its Impact on Housing
The U.S. job market is showing signs of softening, which could impact future rate cuts. According to Lawrence Yun, NAR’s chief economist, a weaker job market often leads to lower rates. The September jobs report showed an average monthly addition of 116,000 jobs over the last quarter, which signals a slowdown in economic growth. However, the impact on home prices may be minimal as long as interest rates continue to drop, keeping homes within reach for most buyers .
In Summary: Opportunities in a Balanced Market
While 2022 and 2023 were heavily skewed toward sellers, 2024 is offering a more balanced market. Buyers have more time and inventory to choose from, while sellers are adjusting to market conditions that require careful pricing strategies. Whether you’re buying, selling, or just curious about the market, it’s a good time to explore your options.
Ready to take the next step? Contact us at BHGRE Senter, REALTORS® for a free consultation today.
Sources:
High Commission Splits: A Realistic Breakdown
It’s no secret that many brokerages love to advertise high commission splits to attract new agents. On the surface, these offers can seem too good to be true — and, in many cases, they are. While a 90% split may sound like an excellent deal, the reality is often much more complex.
Here’s the truth: being a REALTOR® comes with costs — whether you’re covering them yourself or the brokerage is supporting you. From signs, CRM, and business software to advertising, websites, transaction coordination, and office fees, the expenses add up quickly.
Breaking Down the Real Costs
Let’s take a closer look at how these flashy high commission splits can get broken down with everyday expenses. In the example below, you’ll see two scenarios where an agent completes 15 transactions annually and another where the agent closes 25 transactions.
The breakdown shows how easily the high split can be whittled down once you account for expenses like office space, marketing, technology, and more. The numbers reveal that an effective split may end up significantly lower than the advertised one. And let’s be honest — these expenses are probably underestimated!
Time is Your Most Valuable Asset
But expenses aren’t just about money. There’s another cost that’s often overlooked: time. Every minute you spend managing the administrative aspects of your business — whether it’s creating marketing materials, updating listings, managing leads, or handling transaction paperwork — is time that could be spent building client relationships and closing deals.
While these tasks are essential to running a real estate business, they often distract from the core of what agents should be doing: serving their clients.
At BHGRE Senter, REALTORS®, we alleviate those burdens for you. We cover a wide range of costs, from advertising and transaction coordination to technology platforms and office expenses. This means you can spend more time doing what you do best: helping clients achieve their real estate goals.
Maximizing Your Commission with Support
By joining a brokerage like BHGRE Senter, REALTORS®, you’re not just getting a commission split — you’re gaining a comprehensive support system designed to maximize your efficiency and success. Our model ensures that you’re not buried under the weight of endless expenses, and our systems allow you to reclaim your most valuable asset: time.
So the next time you hear about an impressive commission split, remember that the number on paper isn’t the whole story. Make sure you’re factoring in the hidden costs — and consider how much more you could take home with the right support.
Ready to grow your business with a brokerage that truly has your back? Contact Us at BHGRE Senter, REALTORS® today to learn how we can help you take your real estate career to the next level!
Understanding the Housing Affordability Index
Understanding the Housing Affordability Index: Texas and Abilene, TX
The Housing Affordability Index (HAI) is a measure that compares the median family income to the median price of housing, providing insights into how affordable housing is in a given area. This index is a critical tool for understanding the financial accessibility of homes for families across different regions. Let’s dive into what the HAI looks like for Abilene compared to the rest of Texas and what it means for you as a potential buyer or seller.
Abilene’s Affordability in Q2 2024
In Q2 2024, Abilene has an affordability rating of 1.34. This means that the median family income in Abilene is 34% higher than the income required to purchase a median-priced home. In simpler terms, housing in Abilene is quite accessible for the average family compared to many other areas.
Texas as a Whole
When we zoom out and look at Texas as a whole, the affordability rating drops to 1.04. This indicates that, on average, the median family in Texas is only earning 4% more than what’s required to buy a median-priced home. This shows that while Abilene remains relatively affordable, much of Texas is seeing a more significant squeeze on housing affordability.
A Rising Challenge
Housing affordability has become an increasing concern due to the rapid inflation in home prices, services, and general living costs over the last few years. For context, back in 2015, the median family income in Abilene was more than double what was required to buy a median-priced home. Today, that gap has narrowed significantly, highlighting a growing challenge for many families.
Although support systems exist to help those striving to achieve their dream of homeownership, housing affordability remains a crucial issue that will need ongoing focus and solutions.
Abilene: Still Affordable and Family-Friendly
The good news for us here in Abilene is that, while our affordability has declined like the rest of the country, we continue to be one of the more affordable and attractive places to live in Texas. Abilene is a fantastic place to raise a family, and the combination of a welcoming community and accessible housing makes it a great choice for buyers.
Our team at BHGRE Senter, REALTORS is here to help you navigate the complexities of the real estate market. Whether you’re buying or selling, we’re ready to support you every step of the way—just as we have been for nearly 70 years.
Contact us today to get started on making your real estate dreams a reality!
Abilene Housing Insights: August 2024
Another inventory record has been hit this month as we continue to see lower buyer demand in the market. Following the trend of the last several months, buyer demand has been tempered by persistently high interest rates. Additionally, as the early fall months often coincide with back-to-school season, real estate activity tends to slow down during this time. However, there’s reason to be optimistic about an uptick in October and some moderate improvement in the September stats as well.
Inventory and Buyer’s Market Conditions
Currently, we are solidly in a buyer’s market. As we inch closer to 5 months of inventory based on current demand, sellers need to be strategic in pricing their homes and responding to the market. One of the most important things for sellers to keep in mind is that it can take 90+ days just to get a home under contract in this environment. Proper pricing, presentation, and flexibility are crucial in maintaining competitiveness.
Interest Rates and Buyer Opportunity
On a positive note, interest rates have pulled back significantly in recent weeks, and small reductions are expected as we approach the end of the year. This could create renewed interest from potential buyers, particularly those who were previously hesitant due to rising rates.
Let’s dive into some of the latest insights from the National Association of REALTORS (NAR) and what leading economists are predicting for the months ahead.
Instant Reaction: Mortgage Rates – September 12, 2024
By: Jessica Lautz The average 30-year fixed mortgage rate from Freddie Mac fell to 6.20% this week, down from 6.35% the week prior. At 6.20%, a monthly mortgage payment on a $400,000 home with 20% down would be $1,960. For buyers with 10% down, the monthly payment would be around $2,205.
Positive Takeaways:
- Interest rates are down 1.59% from their peak in October 2023, offering a significant saving for buyers.
- A $400,000 mortgage today would save you $341 monthly, or $4,092 annually compared to last October’s rates.
- Inflation is at its lowest level since February 2021, and the Federal Reserve is expected to cut the Fed Funds rate imminently.
Challenges:
- Despite the expected rate cuts, mortgage rates may not decrease further, as these cuts have already been accounted for in the current market.
- While mortgage applications have increased, nearly 47% of these applications are refinancings, not new home purchases, signaling continued caution from potential buyers.
Instant Reaction: Jobs Report – September 6, 2024
By: Lawrence Yun The net monthly job additions averaged 116,000 over the past three months through August, which is a relatively light figure. This could suggest the potential for job losses if the economy faces an unexpected downturn. However, the good news is that the Federal Reserve is expected to cut interest rates as early as mid-September, with more rate cuts anticipated in 2025.
The average mortgage rate is already reflecting these anticipated cuts, currently sitting at 6.3%, down from the 7-8% levels we’ve seen over the past 18 months. FHA and VA loans are seeing rates even lower, under 6%.
What This Means for the Housing Market:
Historically, a weakening job market does not necessarily mean a drop in home prices or sales—especially if it’s accompanied by falling interest rates. With over 90% of the workforce still employed and many considering their jobs secure, falling mortgage rates could exert more influence on the housing market than employment numbers. This could be the case once again if rates continue to drop, spurring homebuyer activity.
Conclusion
In summary, while we are still navigating a buyer’s market, there are promising signs on the horizon. Interest rates are gradually easing, providing an opportunity for buyers who have been waiting on the sidelines. Sellers, however, must remain proactive in pricing their properties correctly and adjusting to market conditions as we move into the fall season.
As always, BHGRE Senter, REALTORS is here to help you navigate these shifts in the market—whether you’re looking to buy or sell. With decades of local expertise and a full-time commitment to our clients, we are ready to provide you with the guidance you need for success.
If you’re considering making a move, give us a call today! Let’s make the most of the current market conditions together.
How Collaboration, Not Competition, Benefits Our Clients
Why We Don’t Do Property Management—and Why It Matters
At BHGRE Senter, REALTORS, we often get asked why we don’t offer property management services. The answer is simple: We’re committed to providing the absolute best service to our clients, and we believe that specializing in real estate sales—residential and commercial—is how we do that.
One of our core philosophies is authenticity—being exactly who we say we are and delivering an uncompromising experience. This means knowing where our expertise lies and where it doesn’t. Property management requires a different skill set and infrastructure, and while many REALTORS might try to take on anything that comes their way, we believe that approach can dilute the quality of service. Instead, we stay true to our calling by focusing on what we do best: buying and selling properties.
The REALTOR’s Calling: Putting Clients First
Our real estate license is more than just a qualification—it’s a responsibility. The National Association of REALTORS calls us to put our clients’ needs above our own, and we take that seriously. Accepting work outside of our expertise doesn’t serve our clients. Unfortunately, too many licensees attempt to take on roles they aren’t fully equipped for in an effort to stay competitive. But at BHGRE Senter, we believe that professionalism means knowing when to say no.
If we aren’t the best fit for your needs, we won’t hesitate to connect you with someone who is. This is not about passing on a deal—it’s about delivering the service our clients deserve.
Collaboration Over Competition
One of the greatest benefits of our approach is the strong relationships we’ve built with property management firms here in Abilene. Instead of competing with them, we collaborate. When clients come to us seeking property management, we confidently refer them to trusted partners who excel in that area. In turn, many of these partners refer clients to us for real estate transactions, ensuring that everyone—most importantly, the client—gets the dedicated, expert service they need.
This philosophy extends beyond property management. Whether it’s a residential agent referring to a commercial expert, or a commercial agent connecting a client with a property manager, our focus is always on collaboration. The unfortunate truth is that when agents stretch beyond their core competencies, the client often suffers. We refuse to let that happen.
Upholding Our Standards for Nearly 70 Years
At BHGRE Senter, REALTORS, we are dedicated to upholding the high standards of our profession. We’ve been a trusted part of the Abilene community for nearly 70 years, providing exceptional service in real estate sales. If your needs extend beyond our expertise, you can still call us! Our referral network—developed over decades and strengthened by our franchise partnership with Anywhere Real Estate, the largest real estate franchiser in the world—ensures that you’ll always be connected with the right professionals.
Our commitment to our clients is unwavering. If you need guidance in residential or commercial real estate, we’re here for you. And if property management is what you need, we’ll point you in the right direction—because that’s what you deserve.
Abilene Housing Insights: July 2024
Rising Inventory Levels
Inventory levels in Abilene continue to rise, increasing options for buyers across various price ranges. While higher interest rates were still a factor for much of July, we began to see a pull-back towards the end of the month, which continued into August.
Sales Trends & Market Comparison
It’s important to note that home sales were up in July 2024 compared to July 2023, but context is key. July 2023 saw a significant drop in sales, and although July 2024 showed improvement, the numbers were slightly down from June 2024. This signals a market that is still finding its footing.
Housing Affordability
Housing affordability is gradually improving but remains a challenge. Throughout 2024, affordability has tempered buyer demand, with property prices, insurance costs, and taxes being the main factors. Sellers should be aware of this trend when pricing their homes.
Seller Concessions & Buyer Assistance
Seller concessions continue to remain high in most price ranges. Buyers needing closing cost assistance can reliably expect to receive support from sellers. This is a strong advantage for buyers navigating today’s market.
New Construction vs. Pre-Owned Homes
The supply of new construction housing remains strong. Sellers in the pre-owned market should be mindful of how their property compares in terms of features and pricing. Price reductions are becoming common, particularly among overpriced pre-owned homes. Now more than ever, receiving expert guidance from a skilled listing agent is crucial.
Interest Rates & Economic Insights
Let’s dive into some insights from NAR economists on interest rates and what to expect moving forward.
Instant Reaction: Mortgage Rates (August 8, 2024)
By Jessica Lautz
- Facts: The 30-year fixed mortgage rate from Freddie Mac dropped to 6.47% this week, down from 6.73% last week. At this rate, with 20% down, a monthly mortgage payment on a $400,000 home is $2,016. This is $285 less per month than in October 2023 when rates were 7.79%, saving homeowners $3,420 annually.
- Positive: This week’s mortgage rates are the lowest since May 2023, marking the biggest one-week drop in nine months. Mortgage applications are on the rise, presenting an opportunity for buyers who had been waiting on the sidelines.
- Negative: While this drop in rates is positive, it’s just one aspect of housing affordability. Home prices remain high, and the rates provided are a weekly average.
Instant Reaction: CPI (August 14, 2024)
By Lawrence Yun
- Inflation Trends: Inflation is calming, setting the stage for the Federal Reserve to begin cutting rates in September. Consumer prices rose by 2.9% in July, with expectations to reach the desired 2% in the coming months. The Fed has indicated it may begin cutting rates as inflation nears 2%, rather than waiting for it to hit that target.
- Shelter Costs: Shelter costs have decelerated to 5.0%, still high but trending down, thanks to a temporary oversupply of new apartment units. However, auto insurance has skyrocketed, up 19% from last year, which could negatively impact property insurance costs.
- Rate-Cutting Cycle: The rate-cutting process is expected to continue through 2025, with six to eight rounds likely. The new normal for mortgage rates may settle around 6%, a notable change from pre-COVID levels of around 4%.
Abilene Housing Insights: June 2024
As we wrap up the first half of 2024, let’s take a closer look at the Abilene housing market trends and key insights from top economists at the National Association of REALTORS®.
Market Trends:
- Inventory Levels: We’ve seen a steady rise in inventory from 3.7 months and 684 total listings in January to 4.6 months and 827 total listings in June.
- Sales Activity: Year-over-year, sales have dipped by approximately 7% compared to 2023.
- Price Movements: Home prices have increased by 7-8% in most price ranges.
- Time to Close: The average time to close has been hovering around 90 days for several months now.
Looking Ahead: While significant changes are not anticipated in the immediate future, better terms may be on the horizon. Here’s what some of the leading voices in real estate economics are saying:
Lawrence Yun, Chief Economist at NAR:
- New Apartment Units: The completion of new apartment units reached a 50-year high in June, leading to a halt in rising rents in many cities. Interestingly, rents have decreased in cities like Austin, Nashville, Charlotte, and Phoenix due to an oversupply of rental units.
- Future Concerns: New multifamily housing starts are currently at a 10-year low due to high financing costs and low rent growth, which might lead to a rental housing shortage in the future. Single-family housing completions were above 1 million, but new starts were below this mark. Lower interest rates could potentially increase housing supply and lower future housing inflation.
Jessica Lautz, VP of Demographics and Behavioral Insights at NAR:
- Mortgage Rates: The 30-year fixed mortgage rate from Freddie Mac dropped to 6.89% recently from 6.95%. At this rate, with a 20% down payment, a monthly mortgage payment on a $400,000 home is $2,105; with a 10% down payment, it is $2,369.
- Inflation Insights: The CPI has retreated, with shelter costs showing slower gains. Fed Chair Jerome Powell indicated a potential path to lowering the Fed Funds rate if inflation continues to cool. However, Powell also noted that we likely won’t see the ultralow rates of the past decade return, meaning buyers waiting for historically low mortgage rates might be waiting for a long time.
Conclusion: As we navigate through 2024, the Abilene housing market continues to show resilience despite national trends. Whether you’re buying, selling, or investing, staying informed and working with experienced professionals like those at BHGRE Senter Realtors can make all the difference. Let’s keep an eye on these trends and insights as we move forward! Contact Us if you need assistance with your real estate goals today.
Abilene Housing Insights – May 2024
Welcome to our latest housing market update for Abilene. As we dive into the data from May 2024, we’ll explore the trends and shifts that are shaping the local real estate landscape. Plus, in celebration of National Homeownership Month, we’ll reflect on the importance of owning a home and how it impacts our community.
Inventory Continues to Soar
The inventory in Abilene is on the rise, with active listings up almost 40% compared to last year. This increase has brought the market to 4.3 months of inventory, marking the highest level we’ve seen in over five years. For buyers, this means more options and a less stressful purchasing process, as the high inventory levels provide a more relaxed environment.
Price Reductions and Stable Property Prices
While we’re seeing a significant number of price reductions, the overall property prices have remained mostly static. The median sales price is up 10% compared to May of last year. However, when we look at the broader data, we notice only a small 3% rise in prices year-over-year. This slight increase is expected, considering the sales prices remained mostly flat throughout 2023. Despite the large amounts of price reductions, the sold data shows very minor adjustments in the final deals year over year.
Affordability and Seller Concessions
Housing affordability remains a challenge, but it has become the new normal. Sellers are adjusting to the market dynamics, offering substantial price reductions and concessions. Buyers can benefit from these high levels of seller concessions, making it a favorable time for those looking to purchase a home in Abilene.
National Homeownership Month
June is National Homeownership Month, a time to celebrate the joys and benefits of owning a home. Homeownership is a cornerstone of the American Dream, providing stability, building wealth, and fostering strong communities. At BHGRE Senter, we are dedicated to helping our clients achieve their homeownership goals. Our decades of experience and full-time commitment to our profession and clients ensure that we are the constant you can count on in this ever-changing market.
Let Us Guide You
The real estate market is always evolving, but our commitment to our clients remains steadfast. Whether you’re buying or selling, our team at BHGRE Senter is here to guide you with expert knowledge and personalized service. Let us help you navigate the current market conditions and find the perfect home for you and your family.
Thank you for trusting us with your real estate needs. If you have any questions or need assistance, please don’t hesitate to reach out. Happy National Homeownership Month from all of us at BHGRE Senter!
Abilene Housing Insights: April 2024
Spring has sprung, and the Abilene housing market is reflecting that with a much-anticipated boost in activity. After a sluggish first quarter, April has brought a refreshing uptick, signaling a strong start to the spring selling season. While rising interest rates and home prices continue to challenge buyers, the inventory of available homes is at one of the highest levels we’ve seen in the past eight years.
Market Dynamics
The increased volume of listings has tipped the scales in favor of buyers across most market segments. Sellers are offering concessions and implementing price reductions daily to stay competitive. Affordability remains a key concern for buyers, with the costs of taxes and insurance adding to the financial burden. Despite these challenges, the current market offers some excellent opportunities for those who can afford to buy.
Advice for Sellers
Given the rapid growth in inventory, it is crucial for sellers to maintain regular communication with their agents. Pricing your property correctly is more important than ever; an overpriced listing can quickly become stagnant in such a competitive market. Sellers should be prepared to make adjustments as needed to attract potential buyers.
Tips for Buyers
For prospective buyers, understanding the true cost of homeownership is essential. While owning a home is still one of the best ways to build wealth over time, the rising prices and increased costs of taxes, insurance, and maintenance can add up quickly. Buyers need to budget carefully and be aware of all the associated expenses to avoid any unpleasant surprises.
Expert Guidance
Navigating the ever-changing real estate market can be daunting. That’s why having the support of a full-time professional is invaluable. At BHGRE Senter, REALTORS, our team of dedicated agents brings decades of experience and a commitment to serving our clients. We provide the guidance and advice needed to succeed in today’s market.
Whether you’re looking to buy or sell, we’re here to help. Contact us today at (325) 695-8000 and let us assist you in making the most of the current market conditions.
Key Takeaways:
- April saw a strong start to the spring selling season after a slow first quarter.
- High inventory levels have created a buyer’s market in many areas.
- Seller concessions and price reductions are common as sellers strive to remain competitive.
- Affordability remains a challenge, but opportunities abound for those who can navigate the costs.
- Regular communication with your agent is crucial for sellers to adjust pricing strategies.
- Buyers need to be aware of the full costs of ownership, including taxes and insurance.
- BHGRE Senter, REALTORS offers expert guidance to help you succeed in this market.
Call us today if we can help you buy or sell! (325) 695-8000
Abilene Housing Insights: March 2024
The Abilene real estate market continues to stabilize, settling into a new normal as we navigate the changing landscape. While home prices have seen a decrease compared to March 2023, overall prices have remained relatively higher in 2024 so far. We anticipate a modest price increase of 1-2.5% by the end of the year.
For Sellers: It’s essential for sellers to receive expert advice, insight, and guidance to remain competitive in the current market. Making informed decisions about whether selling is the right move for you at this time is crucial. Despite high concessions being offered in the market to buyers, many sellers still hold substantial equity in their homes, thanks to the price increases over the last few years. With the right strategies, homes can still sell quickly. Our REALTORS® offer free initial consultations to help you navigate pricing, concessions, staging, and more.
When it comes to listings sold per person across Abilene and the surrounding areas, our team at Better Homes and Gardens Real Estate Senter, REALTORS® stands out in terms of productivity. Let us assist you too!
For Buyers: For buyers, the market offers more concessions than we’ve seen in the last five years. Interest rates have remained relatively stable over the past three months, but we expect slight reductions by year’s end. Inventory levels are the highest they’ve been since 2018, providing buyers with more options and less competition for the perfect home. Our full-time experts are here to guide you through the buying process and help you craft a winning offer.
Importance of Advertising: As market inventory increases, the need for effective advertising becomes more pronounced. While many homes sold quickly in 2022 and 2023 with minimal advertising, this is no longer the case. Listing on Zillow is important, but it only covers around 56-58% of real estate website traffic. Reaching potential buyers across different platforms, including social media and beyond, is essential. Our 10-day paid advertising campaigns for every listing have played a key role in our strong performance.
We’re Here to Help: With nearly 70 years of experience, we are your Abilene-grown, family-owned, residential and commercial real estate experts. Reach out to your favorite BHGRE Senter agent today, and let us help you on your path to success!
March 2024 Stats
Q1 2024 Stats
