As demand from first-time buyers decreases, bidding wars across the Texas housing market will lessen. According to Nicholas Gerli, executive director of Reventure Consulting, the value of homes in Austin could drop by 30 to 40% over the next three years. Rising wood prices, shortages of supplies, and government tariffs are making it difficult for builders to meet demand. Clare Losey, an economist at the Texas Center for Real Estate Research, states that mortgage rates have reduced the purchasing power of buyers of a mid-priced home by about 14 percent.
Experts believe that the fall in the housing market will particularly affect a group of regions, causing prices to fall by up to 20% at the critical points of the pandemic era and in other areas where affordability has plummeted. Mortgage payments have risen to an all-time high, leaving buyers behind and already driving down prices. Joshi says that some areas may not see a major correction in the price of housing due to low levels of new construction. Home prices in North Texas and across the country have increased dramatically in recent months as demand for properties has skyrocketed.
As a result, while prices are higher than the national average, they are significantly more affordable, which will benefit both buyers and the Corpus Christi real estate investment market. Reagan Williamson, managing partner and associate agent of BHGRE HomeCity, believes that home prices will continue to improve positively in this market. Goldman's chief credit strategist, Lotfi Karoui, says that domestic home prices are likely to avoid a correction next year, but expects 39% of metropolitan areas to experience price drops. Goldman points out that 9% of publicly traded companies have reduced prices on Zillow (mainly in areas that experienced a sharp increase in prices during the pandemic), suggesting that the least affordable areas are most susceptible to a correction while more affordable areas in the south are probably better positioned to avoid it.
In conclusion, potential buyers should understand what experts are saying about their local housing markets before making any decisions. While some areas may experience price drops due to overvaluation or affordability issues, others may remain afloat due to low levels of new construction or other factors. It's also important for buyers to consider their own financial situation before making any decisions.