If you are a buyer in the Sacramento competitive housing you may have already discovered finding and buying a home is not an easy task. Buying a home should be an enjoyable experience but with low inventories of homes it is often frustrating and even painful.
Sellers on the other hand are experiencing multiple over asking price offers to chose from. This is especially true in the under $400,000 price range. We are seeing prices go up faster than any time in the past six years.
With low inventory of homes for sale, there are fewer homes to choose from making it harder for buyers to find the one they love. With the market so tight, they have to be watching the market carefully to make sure they get an opportunity to see the house and make an offer if it is the one. A growing trend among listing agents appears to be the setting of rules governing the sale of the home. These rules restrict showings; require loan pre-approval letters from specified lenders, deadlines for submitting offers as well as other more bizarre items. This is a trend which needs to go away!
Why Are There Fewer Homes on the Market if it is a Seller’s Market?
- Lenders are slowing down on foreclosures: The new laws and rules of the foreclosure process are causing lenders to move at a slower pace. In addition lenders are finally doing more loan modifications which eliminate the need for foreclosure and short sales.
- Sellers are not ready to sell: Here in the Sacramento area, even with price increases, we still have a large percentage of home owners who owe more than their home is worth. Most home owners who trade up use the equity from their home to make a down payment on their next home. Although equity may now be building for most there has been a significant loss of equity over the past few years making it more difficult to trade up to the next home.
- Investors are active in the Sacrament region: Investors are buying homes in record numbers and holding on to them as rentals instead of making improvements and flipping them. Often these investors are cash buyers which give them a strong advantage over first time buyers and others who require financing.
- New construction has been slow to get started: Builders have not moved into high gear to meet the new demand for housing.
All this is making it tough on buyers and frustrating for their Realtors. It is hard work finding a home and when you do and your client falls in love with it watching them have their offer rejected is painful.
If you or someone you know is considering buying a home do everything you can to make yourself a strong buyer. If you have questions on what you can do to make the buying process easier, let me know, I would be glad to share my experience. I can be reached at the MagnumOne Realty office in Roseville (916-899-6571) or by email to firstname.lastname@example.org.