2011 Housing Recap with 2012 Implications

Home Prices

• Historic Appreciation is 4% Nationally, but was -4% in 2011
• We were 24% below the trend line
• Current Rate of Depreciation is NOT Sustainable
• Gary Keller - "If you go above or below the trend line, there WILL be a correction."

Mortgage Rates

• This is THE Moment in History that rates are at their lowest
• NY Times called 2009 the "Golden Age" at 5%...Now as low as 3.87%!
• The rates could maybe drop only 1%, if lenders eliminated all profit. Odds of that happening?
• If money is a driver of when you buy...

The Affordability Index

• Affordability Index - percent of income needed to pay mortgage
• Homes have never been more AFFORDABLE in history of recorded time.
• "Why should I buy when prices are down 30%?" Think Price vs Value.
• Timing & Patience seperates Investors from Speculators

Perspective

• Have Perspective. Study History.
• Average Home Prices are +77%
• Average Monthly Payments are +1%

Kyle Pfaffe, REALTOR®

Keller Williams Realty

m: 512-636-9707

w: AustinHomes4You.com