FIRE! FIRE!! MOVE QUICKLY!!!
Yup – that’s what it feels like right now in many cases. It’s like someone yelled “FIRE” and everyone is rushing towards the door. Except that door is the door to the one house that 20 other buyers want. As a Buyer Specialist, it really sucks. We prefer to have our clients have an easy, stress free experience and by nature, this market just exudes stress. Let’s get into the reasons why…
DEMAND: Demand was up 10% over the same time last year, which we could have told you just given the way we’ve been running ragged in the market, trying to keep up. As we’ve mentioned, this upward swing in momentum is due to continuing low rates, as well as home values coming up enough for more people to be able to afford to move. We saw this type of movement back in 2013 but before that, it was 2005 this saw that sort of activity. Our Buyers Specialists can certainly tell you it feels like 2003-2005 with the amount of offers sellers are getting.
SUPPLY AND INVENTORY ACCUMULATION: At this point we are mirroring last year almost exactly. This exacerbates the inventory squeeze as there is more demand and activity than last year, but just as many homes. Here is a great example of this feels in the current market – We showed a home to a client looking in the West Chester area that was listed in the low $400’s. The home had come on the market on a Monday and had more than 20 scheduled showings in 2 days. The Seller’s agent called us and told us he had set a deadline of Wednesday at 6 pm to get all offers to him. It’s likely that home will sell for more than asking price.
SOLD TO LIST RATIO: Overall in April, seller’s received almost 95% of asking price for their homes. In the Downingtown and West Chester Area it was closer to 97% and the inventory accumulation was closer to 2.5 months. This is an extreme Seller’s market. Buyers that are buying an A+ conditioned in those area’s will certainly pay asking price or perhaps above asking price.
RATES: Rates continue to hover around 4% – 3.875% with little movement and not much movement predicted in the near future. This is great for everyone as the interest rates are the “X” factor in the purchase scenario. 1% point could cost you as much as $150 per month which is the equivalent of $30k in purchasing power. That’s pretty significant.
CONCLUSION: The market is amazing and the market completely SUCKS all at the same time. If you are selling a home, as long as you have the price right for the condition and location, getting the home under contract shouldn’t take very much. HOWEVER, getting from the contract to closing has continued to get harder and HARDER, which is where our (The Chris & Caleb Team) expertise really shines.
In fact, starting on August 1st, new government regulations are going to make the processes even harder, at least for the transition time. We won’t get into the nitty gritty here, but it will suffice to say that those who are not fully ready for it will create a ton of havoc and stress for those they serve. We are already preparing to make sure we are ONLY working with companies that are fully ready for it and that we have adjusted our systems to make sure our clients have no clue that anything changed.
With that said, if you are thinking of moving – either selling a home or buying or both – please give us a call to talk about your goals and how we might be a great fit to make those goals a reality with the least amount of stress possible. You can reach us at 484-696-4833.
