Today’s Housing Math Favors Buying — Even in Austin

With mortgage rates still near 7%, even relatively wealthy households are choosing to rent rather than buy, and it’s easy to understand why. The combination of high home prices and elevated mortgage rates has hit affordability hard, and inventories are mounting. In the quarters ahead, it’s entirely possible for national home prices to experience modest year-over-year price declines. Sun Belt states may be susceptible to even more jarring re-pricings.

Does this portend a sea change in Americans’ housing preferences or an all-out crash in prices? I highly doubt it. Even if that were remotely true, timing the market is hard and potentially pointless, unless you have the option to live rent-free in your parents’ guest house while you wait. What truly matters is whether home prices stay on an upward trajectory over the medium- and long-term. Provided real estate follows its usual pattern and appreciates in value over time, buying may still deliver the best financial outcomes. And despite all the handwringing, there’s a reasonably strong expert consensus that prices will continue to do just that.