Homeowners Staying Put Creates a Limited Supply
FINDING LEADS IN A ROCKY REAL ESTATE MARKET LEON MCKENZIE
Falling inventory is causing home prices to shoot up higher and faster than most analysts anticipated .” 1 These tectonic shifts in the market are forcing real estate investors to look elsewhere , as the traditional market simply doesn ’ t offer the deals that were once available .
The market will continue to see challenges as the winter approaches in most areas . Yun continued by saying , “ As winter approaches , inventory will slide further . Few homes are newly listed after Thanksgiving . Historically , inventory tends to be 15 percent lower in winter than summer . Last year ’ s seasonal decline was even more dramatic , at 25 percent . We hope we won ’ t see an inventory decline of that magnitude this winter . Home values rising much faster than income growth will markedly cut into housing affordability .” 2 Housing affordability is a problem not only for the family that is looking for a new home , but for investors who want to add to their portfolio . Many leads simply won ’ t work with high prices and challenges with decreasing supply and demand .
Homeowners Staying Put Creates a Limited Supply
Another change in the market that is causing a decrease in viable real estate leads is that many homeowners are simply staying put in their current homes . The market is seeing decreases in the building of new construction and the banking industry ’ s unwillingness to lend to as many people as pre2008 means that many homeowners are staying in their current homes . This is augmented by the fact that so many homeowners are underwater with their mortgages . Avi Gupta said , “ With record low housing inventories , finding homeowners that are in a position to sell ( and may not even know it yet ) has become critical to the success of real estate agents , not to mention the housing market as a whole . Many homeowners aren ’ t aware of the rapid shift in the market , and others are still leery about what is ahead . Low inventory is causing the housing market to stutter . . . Buyers are out there , but sellers are hiding ." 3