National Media Impact on Local Market?

Asked by Jamie, Austin, TX Thu Feb 7, 2008

National Media Impact on Local Market?

I'm just wondering if you Realtors are seeing the "morale" of typical buyers diminish here in Austin because of the constant sensational, negative media reports on a national level?

I hope buyers realize that listening to market reports dominated by eastcoast and westcoast markets that were massively over priced in the first place is irrelevant when purchasing here in Austin. In other words, if you are waiting until next year to buy, you will in fact pay more for the same house than if you buy today...!

Why do I care how your buyers are feeling? Please check out MLS# 3386125 on Jewelfish Cove. (shameless plug)

thanks for your insight...

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Carol Pease,…, Agent, Austin, TX
Thu Aug 7, 2008
You cannot open the newspaper or turn on the TV without hearing how bad the real estate market has become. What is the good news? While sales are down in the Austin area the average sales price continues to rise. Some neighborhoods sell more quickly than others. It's a great place to live and work.

Carol Ann Pease, ABR, CRB, CRS, e-PRO, GRI
2 votes
Danny Gallant, Agent, Austin, TX
Fri Feb 8, 2008
I agree with Julie's answer completely and think it's unfortunate (although not surprising) that her editorial was rejected by the Statesman. I also share the feeling that we need more optimistic news about our market, because given our economy and all other indicative factors, it is realistic to expect a continuing healthy market.

A perfect example of a recent article that could really use some justified optimism in it's headline is the one below. I would encourage anyone that reads this to make it through the entire article. It talks about some of the reasons home sales were lower in 2007 than in 2006 and what some experts are predicting for the future.

My beef with this type of article is that you don't get to anything positive until at least midway through the text - where most readers have long moved on to another article altogether. I'm sure this helps to sell papers, but it's not helping anyone see our market for what it really is.

What can be gleemed from this as a seller? Homes that are selling, and often quickly, are the best in terms of presentation/staging, price & promotion. That doesn't mean that homes need to be discounted, just properly positionned within their immediate competition.

Danny Gallant, Realtor
The Gallant Group @ Keller Williams


Home sales decline for sixth straight month
Sales in November drop 13 percent, and pending sales may plummet as well
By M.B. Taboada
Tuesday, January 15, 2008

Central Texas home sales declined 13 percent in November from a year earlier, down for the sixth month in a row, according to the Austin Board of Realtors.

Pending sales for December plunged 41 percent, an indicator that the year ended with an even bigger drop.

The national housing slowdown and mortgage crisis has crept into the Austin market in recent months, reducing sales of existing and new homes. Experts attribute the slowdown to tougher mortgage standards that have pushed out many first-time buyers and made it tougher for some affluent buyers to get certain types of mortgages. In addition, there are fewer investors purchasing in Central Texas.

For the first 11 months of the year, home sales were off 7 percent from the same months of 2006. Many national markets have seen much steeper declines and even price drops, and many experts predict that the national recovery won't come until 2009.

Though the Austin market remains relatively healthy, real estate experts predict that existing home sales will continue to dip slightly in 2008 before stabilizing.

"Those buyers who were there a year or two ago aren't there anymore, or at least not on the same basis," said Jim Gaines, research economist with the Real Estate Center at Texas A&M University.

However, home prices still climbed, with the median up 8 percent in November from a year earlier, to $185,500.

There still are enough buyers so that sellers here don't have to significantly reduce prices, Gaines said.

However, the appreciation might be skewed by fewer sales of lower-price homes because many entry-level buyers are locked out of the market, said Sam Chapman, an agent with Keller Williams Realty.

"We're seeing the median price being higher because lower-end homes are being cut out," Chapman said.

Real estate experts said sales in 2007 were good, just not as good as in record-breaking 2006, which had 27,203 sales. Sales might end up similar to those in 2005, at 24,544.

"Austin is not expanding at the rate it was a couple of years ago, but you haven't fallen out," Gaines said. " '07 is still a good year in the housing market, it's just not as good as it was in '06. But 2003 to 2007 were all good years, I just think '06 will turn out to be a peak year."

In general, Chapman said, he has seen the number of buyers decrease since August and the number of sellers increase. Still, he said, some sellers continue to want to overprice their homes, even in the declining market.

Chapman said he thinks the Austin-area market probably will stabilize soon, then improve because of its strong economy and its attractiveness as a second-home market.

"We may dip a little here because of national pressures, but I think we'll come back and be relatively strong," Chapman said.; 912-2942
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2 votes
Julie Nelson, Agent, Austin, TX
Fri Feb 8, 2008
Yup, a little shameless on the property promo but I am SOOO glad you asked the question as this has been a personal sticking point of mine for months. I submitted an editorial to the Statesman this winter on the topic ... it was rejected but I had some interesting email communication with a writer (Amber Novak) and the busienss editor (Charles Ealy). It seems Mr. Ealy had some bumps and bruises from the 80's real estate fall-out and was, thus, cautious as are most people who personally experienced that market. The few positive headlines we have had in Austin have helped and I am seeing the Austin attitude and real estate activity improve.

Here is the not-printed but submitted editorial copy:
How about injecting some optimism into the Austin real estate market? We have one of the best economies in the country, the Austin population is projected to double in the next 20 years, buyers have lots of homes to choose from, room to negotiate and interest rates around 6.25%. it’s been over 10 years since the overall Austin market favored the buyer. I believe there is room for a little optimism and buyers should be encouraged to participate in a market that has turned in their favor.

Statistically in most neighborhoods in Austin, it’s not really a buyers market. It just seems that way compared to how things have felt the past 5 years where you had to make an offer within a couple days on market. Still, the best / coolest homes priced right are moving relatively fast.
2 votes
Betina Forem…, Agent, Austin, TX
Wed Aug 13, 2008
Actually Maurna Desmond with Forbe's wrote that Austin is the #2 market in the USA right now. San Antonio ranked number 5. To back up my statement please see below for her specific comentary on Austin market. Now is a great time to buy and or invest in Austin. They monitored 40 of the nations largest metropolitan markets to obtain this information.

"Lots To Like In The Lone-Star State
Texas dominated our lineup of mortgage-worthy areas. Thanks to a business-friendly tax environment, many large corporations call the Lone Star State home, which creates jobs and tax revenue.
The University of Texas campus provides young blood and research-related jobs to No. 2 city Austin. This state capitol is a hip area on the rise. The vacancy rate has fallen by 37.5% in the last 24 months to just 1.5%, despite a lot of building in recent years. And buying isn't much more expensive than renting. An average mortgage payment is $1,022.40, and average rent hits $767."
Maurna Desmond- Forbe's magazine.
1 vote
Betina Forem…, Agent, Austin, TX
Fri Aug 8, 2008
Dear Jamie,
My Buyers are happy because they are in Austin and they have plenty of homes to choose from. In comparison to the rest of the country Austin is an undervalued market. Our prices are not going down. au contrare! They have consistantly gone up. Round Rock and Pflugerville are not Austin and they have seen some decline, due to being over-built and builders are still building more homes there so it is VERY hard for individuals to compete with builders for the same buyers. Call me if I can be of assistance!
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1 vote
NonRealtor, , 23456
Thu Aug 7, 2008
Is it bad for house prices to decline? I thought it was a good news. I hope Austin declines too. Affordable housing is a good thing, in my opinion. But I guess if you're a realtor, that would make your commission drop. Anyways, I hope gas declines next.
1 vote
Betina Forem…, Agent, Austin, TX
Wed Aug 6, 2008
Dear Jamie,
I think it depends. SOme neighborhoods are still selling quickly if priced right. My listing in Shady Hollow went Pending in five days. However some neighborhoods may take a little longer to sell. Yes, prices are still going up in Austin & I don't see that changing.

I feel that Julie is correct. Austin is a great market and we have good job growth. So I would say shoot your TV and throw out the newspaper. If you want to know what the local market is doing cal a Realtor. We are in the middle of it every day and can give you a more acurate feeling for what is happening right here.

PS. Good Luck with Jewelfish Cove!
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1 vote
Paul B. Perez, , Austin, TX
Mon Feb 11, 2008
The answer depends on WHO you ask and what YOUR local market share consists of. For the homes above 600k closed sales are up 17%. Everything below that has been substantially affected. The under 200k market for end users is down significantly! It goes back to to old saying, the poor get poorer and rich rich get richer.
1 vote
Michael, , Austin, TX
Mon Feb 11, 2008
Unfortunately the best answer to that question is "YES!" Now, in my opinion, there are so many more reason why Austin, its self, is a great investment. On a weekly basis, there are national organizations, such as Forbes and, that recognize our investment enviroment as one of the best in the nation! We are bucking the trend and we, as realtors, have to educate and substaniate, our side of why Austin is a great place to invest.

If you are a realtor or have a realtor working for you, ask them to contact their title company and provide you, the seller or realtor, with the articles that say Austin is the BEST PLACE TO INVEST.

I hope this helps!

Have an OUTSTANDING day!
1 vote
E.J. Mckinney, Agent, Austin, TX
Tue Aug 12, 2008
The National media spotlight on the economy, housing market and the mortgage industry have unfortunately caused some buyers to be more "on the fence" however smart buyers realize that the Austin market, like all other markets, is a local market and that you cannot generalize conditions across the board. In fact, it seems like there are no positive stories being reported locally about how the Austin market is ahead of most of the rest of the country with regard to value and growth. We have recently been reported by Forbes in the top 3 best seller and buyer markets in the entire county. If I can be of any further assistance, please let me know. E.J.
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0 votes
Perry Hender…, Agent, Austin, TX
Tue Feb 12, 2008
Moral is down, more expensive homes sell fast....
0 votes
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