Continued low interest rates sound so good to some area prospective home buyers until they get sticker shock from increasing housing prices. Jennifer Wauhob, the President-Elect of HAR, says area housing costs are 12% higher year over year here, which isn't as bad as Atlanta where they are 24% higher. "I will say the benefit of being here in Texas is that our average home price is still less than in most of the country." Still, even with a low interest loan, an average American household will still have to spend about a third of their income on their mortgage. Home costs are rising due to the heightened competition brought on by low interest rates.
Texas household incomes have risen - but far less than 12% in the same period! With fewer prospective buyers, the competition will cool. And Wauhob's prediction is not dire. "I don't think we're necessarily going to see a CRASH any time soon. You can know that your investment is probably going to make you money over the long term."