A shortage of “move-in ready” homes and bidding wars over houses in good condition are leaving potential buyers scrambling to find a home to buy, according to media reports.
Housing inventories have sunk nationwide, leaving home shoppers with fewer options. Bidding wars are back, and in some markets the shortage is prompting buyers to try to bid on homes even before they are listed, reports The Los Angeles Times.
In April, the number of for-sale homes was 2.5 million, which marks the lowest number for an April since 2006, according to National Association of REALTORS®’ housing data.
“The sharp drop in inventory along with rock-bottom interest rates have helped stabilize even some of the hardest-hit markets, including the Southland, Las Vegas, Phoenix and Miami,” The Los Angeles Times reports. “Some real estate professionals are concerned that the lack of inventory might turn off potential buyers, stifling the recent recovery in home sales.”
While buyers are suddenly feeling a sense of urgency, sellers are feeling they can wait, says Glenn Kelman, chief executive of Redfin.
Meanwhile, investors are snatching up bank-owned properties at bargains, new construction remains at historic lows, and home owners are taking a “wait-and-see-approach” before they list their homes. That’s left many buyers scrambling to find a property.
Some home owners are hesitant to sell, held back by negative equity and waiting for more of a bounce-back in home prices before they list.
"With the downturn, it seems like there are a lot of people who have been waiting in the wings to pounce, and because the rates are low, there is just a lot more competition," says one LA-area home shopper, Eddie David, who says he and his wife have been outbid on three different properties recently. "We tried to get in on a couple other homes, and even though it had been just a week or two weeks, it was just too late."
Source: “Shortage of Homes for Sale Creates Fierce Competition,” The Los Angeles Times (June 10, 2012)