Homes flying off market

[Dustin Ruhl]

It’s the spring 2017 home-selling season and inventory is as low as it’s ever been. In fact, bidding wars are happening all over the U.S. in metropolitan areas and the heartland. With listings being so scarce, prices are rising and buyers are getting desperate. With an improved and increasing confidence in the country’s economy, buyers are clamoring to find homes within their price range. On the other hand, homeowners are slow to sell because they too would be faced with the same low inventory dilemma. Even rising mortgage rates are not deterring potential home buyers. Because of soaring job growth, especially in technology, competition is the fiercest in Denver, Seattle, and Oakland, California. And Grand Rapids, Michigan; Madison, Wisconsin; and Omaha, Nebraska are not far behind. Recently in Grand Rapids, a single listing brought in 40 bids! If anything, rising mortgage rates are an even greater incentive to buy sooner rather than later. Since the election, the 30-year fixed rate has increased by more than half of one percentage point. Savvy buyers understand that this trend could continue. Also, The Federal Reserve just increased its interest rate by a quarter point and intends to do so again later this year. Traditionally, this move causes borrowing costs to rise, which would put them at levels that haven’t been seen in ten years. In a few cities such as Miami and Manhattan, inventory has risen due to new construction, however, these areas are the exception. In Philadelphia, buyers are submitting full-price offers before homes are even on the market. Properties nationwide are selling in the first two weeks of being on the market.

Key Takeaways:

• The real estate market has become very competitive with homes for sale at its lowest rate in years and interest rates are rising.
• Real estate agents are getting creative and even calling home owners with offers from buyers for homes that are not for sale.
• Interest for a 30 year mortgage were at 4.3% last week and most likely grow to 4.7% by the end of 2017 and 5.5%in 2018.

"Homebuyers are going to find this spring that, in a lot of markets, the inventory of homes priced and sized at price levels they were hoping for will be very limited."

Read more: http://www.journalgazette.net/business/Homes-flying-off-market-18307909