Have you ever been to a store in search of a specific candy bar, bike, shirt, or book, only to find that when you get there, they are all gone? Chances are that a good number of other people also found that item appealing, enough to temporarily drain the store’s resources. If the store sees fit, they may charge more for the product. It’s a facet of any market that, on occasion, the number of available items does not equate the demand. The shelf stay is very short for these sparse items, and they sell at full value. Believe it or not, this is taking place in the housing market right now.
Half the TimeIn some cities, properties are on the market for only a few months before they are sold, about half as long as it takes to sell a home in a stable market. Notable among these are:
Los Angeles, California
West Palm Beach, Florida
In these cities, homes last on the market an average of 3.4 months in comparison to the usual 7 months. This drives home prices up and makes finding a home difficult, since they are gone in the blink of an eye.
Pros and Cons
A low-inventory market has both pros and cons, depending on your role in the housing market. For buyers, it’s nerve wracking because as you consider homes, they disappear from the market almost as soon as you step out onto the porch after a tour. This makes buying stressful, because you do not have a lot of time to wrangle out your decision. It’s great news if you are attempting to sell your home, since the amount of time and money you spend on the market is dramatically reduced, and you are more likely to sell your home at it’s full value.
What do You Do as a Buyer?In a way, buyers have the short end of the stick in this situation. Their chances of finding a home are considerably lower, and their chances of working the price of the home down to fit their budget are fairly slim. So, what can you do? First of all, find someone who knows the odds and ends of the market. Hiring a buyer’s agent gives you several advantages. They have access to new additions to the market almost as soon as they are posted and can watch specific neighborhoods you are interested for openings. Second, be cautious in your price haggling. This is tricky, because an offer that is too low may be rejected forever, but an offer that is too high will not save you money. This is where a buyers agent comes in handy, because you have a secondary professional opinion about the home you are considering. Third, be prepared to merge the timing of your home purchase with the timing of your life. As financially beneficial as it can be to wait for the market to change, sometimes your best bet is to purchase your home when it works out best with the rest of the events in your life. When you are ready for a new home, you are ready for a new home. Don’t feel overly pressured to buy at specific times of the year.
In the rapidly changing real estate market, keep your eyes peeled for deals and opportunities. 2013 looks like a promising year and ,with prudence and the help of one of our experienced realtors, you can make it a big one for your home ownership.