How is inventory in your market?

[Johnny Quilenderino]

DC inventory is at all time historic lows. I expect the inventory to slowly creep up, as interest rates race to back to above 3 percent. Deals are being made in the condo markets, but absolutely shredded in the single family home market. The last offer I placed for a SFR lost out to 53 other offers.

DC metro inventory would have to stop selling inventory for 10 months to get back to "buyers" market. We have .4 months of "good" inventory on the market, anything that stays longer than 14 days, there is something wrong with it and we can at cut at least 10-20k off the price to start the negotiation. 

How low is the inventory where you guys are looking to invest, or buy your first home? 

[Ruth Lyons]

This housing inventory shortage is unprecedented in the real estate housing market. An agent in Maryland, I’m working with several buyers who are very frustrated trying to find a home. As seems to be the case across the country, homes that hit the market sell in a few days with multiple offers pushing the price past asking.

There seem to be a lot of contributing factor, many pandemic related:

• - Employee uncertainty of what “work from home” will look like in 6 months are reluctant to consider selling. At the same time, more buyers are coming to the market looking for homes with amenities more conducive to working from home like less open space, a home office, etc.
• - Sellers who want to move see very limited choices on the market and decide not to sell (where will they move to?).
• - Baby-boomers and the elderly hold a lot of the would-be homes for sale and many are reluctant to move or fearful of having showings during the pandemic. And the elderly are increasingly unlikely to make the move into assisted living facilities and nursing homes as long as pandemic restrictions are in force.
• - Mortgage forbearance government mandates have restricted the flow of homes to market. Foreclosures that would have been available never made it to market.
• - The cost of construction materials has been rapidly and steadily increasing since the pandemic hit constricting new homes being built and put on the market. Without new homes to move into, many would be sellers can’t find what they want on the market.

Some factors aren’t directly related to the pandemic:

• - Historically low interest rates have driven up demand --- with buyers flooding the market -- while squelching supply as many would be sellers simply refinanced and decided to stay put.
• - Available inventory of homes was already trending down before the pandemic hit. Pandemic factors contributed to the downward slide.
• - The construction industry has a shortage of workers, having never fully recovered from the 2008 housing crash which pushed construction workers into other jobs. At the same time, stricter immigration policies have led to fewer available workers who typically fill these jobs.