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Climbing mortgage rates have hammered affordability for Texas buyers

(Pexels)

Almost every week since January, mortgage rates have gone up and up.


Sonya Valia, a loan officer with Vista Lending in Austin, says it’s been one of the most volatile years she’s seen yet in her almost 21 years in the role. Beginning of the year, rates were in a low 3% range, but the last two to three months have seen rates soar.

So, for example, a Texas buyer looking at a $500,000 home is paying a rate in the mid to upper 5s whereas a year ago, it was under 3%.

"In the mortgage world, that's significant," Valia said. "That can really affect someone's buying power, which is why clients have had a lot of sticker shock."

A Google online mortgage calculator shows that a $500,000 loan amount (30 year fixed) with a 3% rate would produce a $2,100 monthly payment. The monthly number soars 43% to $3,000 with a 6% rate.

Valia points to the high rates, spurred by the Federal Reserve's rate hikes that are intended to fight inflation, have resulted in fewer offers and closed sales. In the past couple of years, Valia describes a frenzy of offers, sometimes dozens, on almost every house. Now, it's more like two to three, she says.

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Austin rents nearly double in a year and are now in the top 5 nationwide
Dwellsy

While searching for a place to live, Austin renters will face monthly rates of nearly $3,000, a recent guide from rental marketplace Dwellsy shows.

The median rent in August this year was $2,930, a more than 86% increase since August 2021. That’s $820 more than the nationwide median asking rent in August and puts Austin just below the Bay Area, Boston and New York for large cities with the most expensive asking rent.

“Within this group, Austin, TX stands out for the highest increases in asking rent, which has nearly doubled since this time last year,” the study notes.

Outside of those large cities, however, others are seeing even higher rent spikes. Metro areas that ranked above Austin in one-year increases include those like Kansas City, MO with a 112% change in rent since last August and Tucson, AZ with a 124% change.

The data reflects large apartment communities, single-family homes and 2-6 unit buildings.

Setting the stage for safety at ACL
ACL Festival

Remember that ticket you and hundreds of thousands of others bought to get into this year's Austin City Limits Music Festival in Zilker Park? Well it turns out it guarantees you a lot more than just music this year.

"By purchasing a ticket, you agree to submit to a full body pat down and magnetometer screening before entry," says the festival's website, which goes on to add, "Persons that refuse to comply with the search will be refused entry to the event."

It's all part of a safety and security plan festival organizers say they're working on 24/7 that changes every day.

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