Can you get a loan? Should you buy?

Posted on Monday, October 20th, 2008 at 9:58pm.

These are crazy economic times - leaving many reconsidering thoughts of buying Austin real estate. We’ve got good news for those of you on the fence: money is out there, and Austin is the place to buy. It’s true that subprime Austin home loans are now nearly impossible to get and expensive when they are offered. In addition, banks are scrutinizing all loans these days to mitigate risk. That means even prime borrowers (people with good credit and an income and loan-to-value (LTV) ratio lenders like to see) will have to show more documentation on their income and appraised property value.  The good news is banks are still lending for Austin home purchases. In addition, rates appear to be coming down (at least in the short term according to some experts - rates are quite volatile overall). Today, a 30 year fixed rate mortgage for an Austin home purchase is around 6.35% and a conforming 5/1 ARM is at 6.06% (source: kxan.com). These are still historically low rates - in the 1980’s rates were in the double digits. So you may just be able to get a loan after all, and the rate may look great but the question remains, should you buy an Austin home?  Here are a few reasons to buy: 1. Austin is ranked #1 by Forbes for Best Bang for the Buck. 2. Deals are out there!  The Austin Board of Realtors reported slight increases in the average sales price for the Austin area in July and August, but September saw a 3.2% sales price drop, indicating a good time to purchase an Austin home. 3. Austin is seeing job growth.  The Austin economy is faring well with a 2.4% job growth increase in August since the same time last year, and only a small rise in unemployment (up from 4.4% to 4.5%). Read more about Austin’s job growth on our recent blog post:  Austin Job Growth - 2nd Nationwide. These are good reasons to buy, but if you are new to the area, you also need to know that Austin is simply a great city to call home. Ask around and you’ll find that the weather is sunny practically year round, we boast an affordable cost of living, the music scene is second to none, recreation opportunities abound, our workforce is well educated and highly skilled, and the city itself is vibrant and beautiful! Ready to move? Give us a call at 512.600.1800 and we’ll help you find great Austin real estate today!

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