So, Where Are All The Bargains?
Like every real estate agent, I am lucky enough from time to time to receive a call from someone wanting to purchase a property. Quite often, these people tell me they are "looking for a real bargain".
That's perfectly understandable.
I like finding and buying a bargain, too!
But the new question has become, "where is all the bargain real estate these days"?
The answer to that is simple: it is disappearing.
The inventory of bargain-priced listed homes, especially lower priced short sales and foreclosures, is gradually being reduced in the national and local marketplace. This is causing prices to increase. In fact, if you are just starting to look for bargain real estate as an investment, well, you may be a year or so too late.
Don't believe me?
Well, perhaps you will believe real estate data provider Core Logic.
Core Logic has just released info showing that home prices have increased for 13 consecutive months nationwide. The reason? It appears that more and more buyers are bidding up prices on the limited supply of homes available for sale. In other words, we have a market with high demand combined with low supply. The result? Rising prices. That's good ol' Economics 101, just in case you need a quick refresher on that course.
Apparently prices have moved up in 46 states across the country. If you delete short sales and foreclosures from the list of sold properties, prices have moved up in every state. Why? Steady job growth and record low mortgage rates ... plus, I like to factor in pent-up demand for housing as the reasons for these sales increases. In addition, investors and these new investment companies have entered the marketplace and are gobbling up properties to use as rental units and for future capital appreciation. Investment companies are taking a lot of property out of the current inventory.
To give you an idea of how low the inventory of homes for sale has become, Core Logic says that the number of homes for sale has dropped 17 percent for the year ended March, 2013. Man, that's a big drop in inventory nationwide in a year. In fact, the number of homes currently for sale would be exhausted in only 4.7 months at the present rate of selling activity. A six month supply is considered a healthy market, so obviously we are in a seller's market. That's another reason why there are fewer and fewer "bargain" homes out there.
My advice? If you are a buyer, act now. Home prices are most likely going to continue to go up unless inventory greatly increases, mortgage rates suddenly skyrocket, or folks just stop buying real estate for some unknown reason. Those are relatively unlikely scenarios, so I'd suggest buying now if you can find a suitable property.
That's perfectly understandable.
I like finding and buying a bargain, too!
But the new question has become, "where is all the bargain real estate these days"?
The answer to that is simple: it is disappearing.
The inventory of bargain-priced listed homes, especially lower priced short sales and foreclosures, is gradually being reduced in the national and local marketplace. This is causing prices to increase. In fact, if you are just starting to look for bargain real estate as an investment, well, you may be a year or so too late.
Don't believe me?
Well, perhaps you will believe real estate data provider Core Logic.
Core Logic has just released info showing that home prices have increased for 13 consecutive months nationwide. The reason? It appears that more and more buyers are bidding up prices on the limited supply of homes available for sale. In other words, we have a market with high demand combined with low supply. The result? Rising prices. That's good ol' Economics 101, just in case you need a quick refresher on that course.
Apparently prices have moved up in 46 states across the country. If you delete short sales and foreclosures from the list of sold properties, prices have moved up in every state. Why? Steady job growth and record low mortgage rates ... plus, I like to factor in pent-up demand for housing as the reasons for these sales increases. In addition, investors and these new investment companies have entered the marketplace and are gobbling up properties to use as rental units and for future capital appreciation. Investment companies are taking a lot of property out of the current inventory.
To give you an idea of how low the inventory of homes for sale has become, Core Logic says that the number of homes for sale has dropped 17 percent for the year ended March, 2013. Man, that's a big drop in inventory nationwide in a year. In fact, the number of homes currently for sale would be exhausted in only 4.7 months at the present rate of selling activity. A six month supply is considered a healthy market, so obviously we are in a seller's market. That's another reason why there are fewer and fewer "bargain" homes out there.
My advice? If you are a buyer, act now. Home prices are most likely going to continue to go up unless inventory greatly increases, mortgage rates suddenly skyrocket, or folks just stop buying real estate for some unknown reason. Those are relatively unlikely scenarios, so I'd suggest buying now if you can find a suitable property.
-30-
posted by Terry Ward at 4:54 AM
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