There’s good news and there’s bad news….
The bad news comes with reports released by the Fed late last week. Foreclosures are at an all time high, and homeowner equity dipped below 50% for the first time on record. In short, people’s credit lines are maxed out across the U.S. and the payments are now catching up with them.
Some economists are predicting that we have yet to see the bottom of the credit/housing crisis, and that things could continue on a downward spiral for as many as three years.
The good news? As the song goes, “God Blessed Texas…”
Texas, and particularly Austin, seem to be bright spots in an otherwise bleak economic outlook. The Texas Workforce Commission reported Central Texas job growth to be 4.2% with unemployment at 3.9%. In short, the local Austin economy is blowing the doors off most areas of the country. Dr. Mark Dotzour, chief economist at the Real Estate Research Center at Texas A&M, recently said at a market forecast that Austin’s strong local economy could help insulate the Central Texas region against national troubles, but could not make it completely impervious to the effects of tightened credit restrictions and rising energy costs. The question on all our minds is…..how long can Austin hold out, and how deeply national woes impact Central Texans? We’ll let the numbers speak for themselves as we progress into the traditionally busy spring season for real estate. Stay tuned….
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