Aug
2


It's a great time to be a seller

Thursday, August 2, 2012

"We've been seeing steep declines in housing inventory", according to Chris White. "Multiple offers are back on the board and well priced homes sell quickly. Obviously it's a great time to be a seller."

"We've been seeing steep declines in housing inventory", according to Chris White. "Multiple offers are back on the board and well priced homes sell quickly. Obviously it's a great time to be a seller."
Though many home shoppers who assume they are still in a buyer's market find it hard to believe, one of the sobering fundamentals shaping real estate this summer is shrinking inventory: The supply of houses for sale is down significantly in most areas compared with a year ago, sometimes dramatically so.
And that is having important side impacts — raising prices and homeowners' equity stakes, and reducing total sales.
In major metropolitan markets across the nation, the stock of homes listed for purchase is down by sometimes extraordinary amounts — 50 percent or more below year-ago levels in several areas of California, according to industry studies.
In Washington, D.C., and its nearby suburbs, listings are down by 28 percent, reports Redfin, an online real-estate brokerage based in Seattle.
In Los Angeles, available inventory is 49 percent lower than it was last summer, San Diego by 53 percent. In Seattle, listings are off by 41 percent.
According to the National Association of Realtors, total houses listed for sale across the country in June were 24 percent lower than a year earlier.
The dearth of listings is often more intense in the lower- to mid-price ranges, less so in the upper brackets.
Peggy James, an agent with Erick & Co. of Exit Choice Realty in Prince William County, Va., says she gets calls "all the time" from buyers asking, "Where are all the new listings? Are you agents bluffing" — holding back? But the reality is that "there just haven't been many" listings in some high-demand price categories lately, she says.
In Orange, Calif., Carlos Herrera, broker-owner of Casa Blanca Realtors, says "it's really strange right now. We have many buyers but few sellers," forcing purchasers to bid up prices on what's available.
Just south of San Francisco, Redfin agent Brad Le says inventory in Silicon Valley is down so drastically — and demand so strong — that the bidding wars are spinning off the charts.
"We're not just talking about 10 or 15" offers, he says, "but sometimes 40 and 50."
Some buyers are inserting escalation clauses into their contracts to keep pace with counter bids, and waiving financing contingencies, inspections and even agreeing to increase their down payments to counter any differences between the accepted sale price and the appraised value.
One modest, 1,700-square-foot house recently was listed at $879,000. It drew more than 50 competing offers and sold to an all-cash buyer for $1,050,000 in less than a month.
Silicon Valley is in its own special economic niche, but declining inventories are nationwide.
In its latest survey of 146 large markets, Realtor.com found that 144 had lower supplies of listings last month than a year earlier.
Online real-estate and mortgage data firm Zillow, also based in Seattle, reports that some of the steepest declines in inventory are in places that got hit the hardest during the bust, and where sizable percentages of owners still are underwater on their mortgages.
In Phoenix and Miami, for example, 55 percent and 46 percent of owners respectively have negative equity.
Both cities have seen significant drops in inventory, and both are experiencing strong appreciation in home prices.
According to data from research firm CoreLogic, Phoenix prices are up 14.7 percent for the year and Miami by 9.7 percent.
What's behind the widespread declines in listings? Analysts say negative equity plays a major role — it discourages people who might otherwise want to sell from doing so.
They don't want to take a big loss, especially in a slowly improving price environment. So they sit tight rather than list.
Banks with large stocks of pre-foreclosure and foreclosed properties are doing the same, creating a so-called "shadow inventory" of houses estimated to total 1.5 million units.
Where's this all headed? Stan Humphries, chief economist for Zillow, says the likely trend is for more of the same: Constricted supplies will lead to price increases, especially in segments of local markets where demand is strongest.
Longer term, price increases will gradually rewind the cycle, increasing owners' equities and convincing more of them to list and sell.
This, in turn, should put a brake on price increases, especially under today's super-strict mortgage underwriting and appraisal practices.
Bottom line for anyone looking to list or purchase anytime soon: Though conditions vary by location and price segment, lower supplies of houses available for sale are changing market dynamics — putting sellers in stronger positions than they've been in years."We've been seeing steep declines in housing inventory", according to Chris White. "Multiple offers are back on the board and well priced homes sell quickly. Obviously it's a great time to be a seller."
Though many home shoppers who assume they are still in a buyer's market find it hard to believe, one of the sobering fundamentals shaping real estate this summer is shrinking inventory: The supply of houses for sale is down significantly in most areas compared with a year ago, sometimes dramatically so.

And that is having important side impacts — raising prices and homeowners' equity stakes, and reducing total sales.

In major metropolitan markets across the nation, the stock of homes listed for purchase is down by sometimes extraordinary amounts — 50 percent or more below year-ago levels in several areas of California, according to industry studies.

In Washington, D.C., and its nearby suburbs, listings are down by 28 percent, reports Redfin, an online real-estate brokerage based in Seattle.

In Los Angeles, available inventory is 49 percent lower than it was last summer, San Diego by 53 percent. In Seattle, listings are off by 41 percent.

According to the National Association of Realtors, total houses listed for sale across the country in June were 24 percent lower than a year earlier. The dearth of listings is often more intense in the lower- to mid-price ranges, less so in the upper brackets.

Peggy James, an agent with Erick & Co. of Exit Choice Realty in Prince William County, Va., says she gets calls "all the time" from buyers asking, "Where are all the new listings? Are you agents bluffing" — holding back? But the reality is that "there just haven't been many" listings in some high-demand price categories lately, she says.In Orange, Calif., Carlos Herrera, broker-owner of Casa Blanca Realtors, says "it's really strange right now. We have many buyers but few sellers," forcing purchasers to bid up prices on what's available.


Just south of San Francisco, Redfin agent Brad Le says inventory in Silicon Valley is down so drastically — and demand so strong — that the bidding wars are spinning off the charts."We're not just talking about 10 or 15" offers, he says, "but sometimes 40 and 50."Some buyers are inserting escalation clauses into their contracts to keep pace with counter bids, and waiving financing contingencies, inspections and even agreeing to increase their down payments to counter any differences between the accepted sale price and the appraised value.

One modest, 1,700-square-foot house recently was listed at $879,000. It drew more than 50 competing offers and sold to an all-cash buyer for $1,050,000 in less than a month.Silicon Valley is in its own special economic niche, but declining inventories are nationwide.

In its latest survey of 146 large markets, Realtor.com found that 144 had lower supplies of listings last month than a year earlier.

Online real-estate and mortgage data firm Zillow, also based in Seattle, reports that some of the steepest declines in inventory are in places that got hit the hardest during the bust, and where sizable percentages of owners still are underwater on their mortgages.In Phoenix and Miami, for example, 55 percent and 46 percent of owners respectively have negative equity.

Both cities have seen significant drops in inventory, and both are experiencing strong appreciation in home prices.

According to data from research firm CoreLogic, Phoenix prices are up 14.7 percent for the year and Miami by 9.7 percent.

What's behind the widespread declines in listings? Analysts say negative equity plays a major role — it discourages people who might otherwise want to sell from doing so.They don't want to take a big loss, especially in a slowly improving price environment. So they sit tight rather than list.

Banks with large stocks of pre-foreclosure and foreclosed properties are doing the same, creating a so-called "shadow inventory" of houses estimated to total 1.5 million units.Where's this all headed? Stan Humphries, chief economist for Zillow, says the likely trend is for more of the same: Constricted supplies will lead to price increases, especially in segments of local markets where demand is strongest.


Longer term, price increases will gradually rewind the cycle, increasing owners' equities and convincing more of them to list and sell. This, in turn, should put a brake on price increases, especially under today's super-strict mortgage underwriting and appraisal practices.

Bottom line for anyone looking to list or purchase anytime soon: Though conditions vary by location and price segment, lower supplies of houses available for sale are changing market dynamics — putting sellers in stronger positions than they've been in years.

 






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Estella said
"That is a beautiful shot with very good lighting ." about Women Consider Owning a Home to be a Vital Component of the American Dream
on Sunday, May 12, 2013 @ 9:57 AM

Chris White - Team Leader said
"Unfortunately you are not alone. It's more than an outcry. The powers that be really need to come down harder on Bofa than they already are. Working on these short sale for over 2 years now I've uncovered down right fraud happening on the lenders parts. If they cared more about moving this country forward than protecting their own wallets then they would cut the red tape and approve these short sales in a timely manner. Our team made the wise decision to get BofA loans which were FHA or Freddie Mac backed, approved prior to listing on the market. Then we can list the home as "Price Approved" and close in 30 days. In this instance BofA does a full appraisal, rather than an incompetent "Broker Price Opinion" (nothing against agents but they have no idea how to make adjustments on comparable homes) and then the bank issues an "Approval To Participate" letter which dictates what price we can go on the market and take anything north of 88%. I really do hope your situation improves. " about Congressional Bill to Speed Up Short Sales
on Tuesday, August 30, 2011 @ 9:15 AM

Lisa Zeiner said
"We made an offer 4 months ago to BofA, and have heard nothing. It was a cash offer which is better than the zero money they are collecting now. And since the people don't care they are trashing the place, by the time BofA gets around to it our offer will be gone as the place is a mess!! Septic issues now, garbage being dumnped. All of this could have been avoided if BofA really wanted to correct their cash flow problem and sell these properties in a timely manner. They cry about cash but then do nothing intelligent to fix the problem" about Congressional Bill to Speed Up Short Sales
on Tuesday, August 30, 2011 @ 9:06 AM

Jones Ramirez said
"Thank you for the work you have done into this post, it helps clear up a few questions I had." about How do appraiser’s determine a homes value?
on Tuesday, April 19, 2011 @ 10:07 PM

HollyRobsonf said
"Hey - I am certainly happy to find this. great job!" about Bank of America to Offer Principal Reduction to Underwater Borrowers
on Wednesday, April 13, 2011 @ 6:45 PM