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I once had a co-worker in a different industry look at herself, and then me, one February day with disgust. All she said was, “Ugh, we look like February.” The cold dreary days of this month had apparently been rubbing off on our appearances.
It won’t be long and these frigid temps will blend into warm weather, and we’ll feel the glow of sunlight on our faces and arms again. Seriously, the 60’s are in the forecast for as early as Monday. The snow can’t melt fast enough.
It’s a similar sentiment in Real Estate right now — locally and on the nationwide level. I’d love to always tell you the market is hot and homes are flying, but neither of those statements are true. The fact of the matter is this market can’t thaw fast enough. Sellers want to move faster, Buyers feel no urgency and everyone is waiting for a major reduction in either mortgage interest rates or home prices.
Local Home Price Drop
Shift in Mortgage Interest Rates
One thing we are used to seeing climb is Mortgage Interest Rates. And within the past 10 days or so, we’ve seen a steady and steep drop for every product, according to Mortgage News Daily.
This screenshot, updated today, shows every product except the Jumbo loan now in the 6% bracket. This is based on quite a few assumptions and quotes will vary from consumer to consumer. But the takeaway is all numbers are trending in the right direction for affordability.
I have quite a few Lenders I can share with you if you need mortgage interest rate quotes and counseling specific to your qualifications.
Though these rates seem to be on a steady downward trend lately, the only thing we’ve come to count on with mortgage interest rates is volatility. They could just as easily climb again as seen in the graph. And in all honesty, odds are slim that we will continue to see this downward trend much longer. Rates are not expected to decrease much, if at all, in 2025. And in 2026, there may be slight change. So don’t hold out for any earth-shattering change with mortgage interest rates anytime soon.
Fannie Mae Researcher Kim Betancourt told Inman News, “As noted in our latest forecast, we currently expect mortgage rates to end 2025 around 6.5%, relatively little changed from where we are today, which will likely continue to hinder relief for housing affordability and home sales activity.”
It’s worth noting that though mortgage interest rates seem high, they have remained below the historical average since the sudden spike in October 2023.
Homes Hitting the Market
What we really need to also see to encourage more Buyer activity is an increase in homes hitting the market. This chart shows where were were with local inventory pre-pandemic, represented by the green line. That’s the line we’ve been trying to get back to since dramatically sinking below it in 2020. The past couple of years, we’ve stumbled to get off the ground, thanks to so many Sellers being locked into pandemic-era mortgage interest rates. And just when national headlines tell us about a dramatic increase in listings, Williamson County is falling short. You can see the weak red dot, representing 2025 so far, even below where we started last year.
Looking Forward to Spring
We are all smiles in this picture, but we’re going to be even happier when the sun is here to stay and the excitement of Spring breathes new life into local home sales.
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