Decoding the Texas Real Estate Landscape: Trends, Tips, and the Great Debate of Renting vs. Buying in 2024

Hello everyone, I trust you've had an amazing start to the new year and are geared up for what 2024 has in store!

Today, let's delve into the dynamic Texas housing market, exploring the intricacies through detailed statistics and percentages. Buckle up for a journey into the heart of real estate.

Housing Inventory:

Let's kick things off with the housing inventory. In the week from January 5th to January 12th, the active listing of homes in Texas witnessed a growth from 499,000 to 505,000. To put this in perspective, last year during the same week, the inventory increased from 471,000 to 473,000. Interestingly, the lowest point for inventory in 2022 was 240,000, while in 2023, it peaked at a staggering 516,000 homes. Even back in 2015, active listings were at 931,000 during this week. This data underscores that despite some growth, Texas is still very much in a seller's market.

For buyers, the good news is that housing inventory grew, but the bad news is that the number of price cuts decreased. In the first couple of weeks in 2024, only 32% of homes had price cuts, compared to 36% in 2023 and 21% in 2022 during the same period. This trend suggests a challenging landscape for buyers, as lower rates correspond to higher prices.

Leadership Changes:

Shifting gears, Kevin Sears was recently named the new president of the National Association of Realtors (NAR), becoming the third president in just over four months. While the consensus on this choice is positive, the NAR is embroiled in legal complexities. They have requested a new trial in response to a corporate broker's recent lawsuit, claiming several legal defects in the plaintiff's case.

Bitcoin ETF Approval and Market Volatility:

In the financial realm, the SEC finally approved the Bitcoin spot ETF, leading to a surge in Bitcoin's value. However, the SEC stopped short of endorsing Bitcoin as a safe investment. The market exhibited volatility, with Bitcoin's value fluctuating between highs of $49,000 and lows around $42,000 over the weekend. The future of cryptocurrency remains uncertain, with potential drops on the horizon.

CPI Inflation Report:

Zooming into economic indicators, the Consumer Price Index (CPI) inflation report for December revealed a higher-than-expected increase of 3.4%. This marks the first time since February 2023 that both core CPI and headline CPI exceeded expectations. Affordability remains a concern, with notable increases in car insurance (20%), transportation (10%), car repair (7%), rent (65%), homeowners' inflation (6%), hospital services (5.5%), and food away from home (5.5%).

Renting vs. Buying:

The real estate landscape prompts a crucial debate – renting versus buying. Analyzing a hypothetical scenario of buying a $350,000 house with a 7% interest rate and 5% down payment, the analysis spans a 9-year period. Even in the face of rising rents, the math still favors buying, with potential equity gains and other factors tipping the scale.

Tips for Sellers:

Switching gears, for those navigating the seller's side, here are seven strategies to ensure a swift and lucrative sale:

1. Curb Appeal and Foyer: Make a stellar first impression with impeccable landscaping and a welcoming foyer.

2. Furniture and Floor Plan: Create a logical floor plan to help buyers envision the space.

3. Pets and Odors: Address pet-related concerns and eliminate unpleasant odors.

4. Pre-Inspection and Repairs: Get the home inspected and fix any issues upfront.

5. Professional Photos and Descriptive Listings: Invest in professional photography and compelling descriptions for your listing.

6. Know the Competition: Price competitively and understand incentives offered by other listings.

7. Repairs and Overall Presentation: Take care of minor repairs and present the home in its best light.

Armed with these insights, both buyers and sellers can navigate the Texas real estate market more strategically. Stay tuned for more updates next week, and mark your calendars for a special episode with Aaron van Trojan, the founder and CEO of Geneva Financial, this Thursday.

Until then, be good, keep grinding, and see you next week!