May we actually see a seller’s market soon?by Tim Manni
According to a recent survey, the opinions of both potential buyers and sellers suggest that the real estate market could quickly shift from a buyer’s market to a seller’s market. As the months go by, we’re starting to get a clearer picture of what type of properties potential homebuyers (non-investors) are interested in.
Survey: Now is a good time to sell
According to real-estate brokerage Redfin’s latest “Real-Tim Home-Buyer Tracker,” a second-quarter survey of more than 1,200 homebuyers in 18 metros who have toured at least one home since March, the percentage of those who believe now is a good time to sell more than doubled since their previous survey. Furthermore, 58 percent said they now believe home prices will rise this year, compared to just 34 percent in the first quarter.
But what’s interesting is the survey also found that buyer sentiment is starting to slip, just as sellers begin to grow more optimistic. Fewer respondents believe now is a good time to buy and fewer potential buyers are being lured to the market by low interest rates.
According to the survey, fewer buyers are interested in distressed properties, and low inventory is “still the most common complaint [among potential buyers] by a large margin.” Translation: Buyers are searching for non-distressed properties which haven’t been on the market for long. By this reckoning, if more potential sellers try their hand at the market this summer, more buyers could be lured back. And the real estate wheel turns.
If this trend persists, we could see a meaningful impact on home prices. While recent reports indicate some substantial home price growth on a national level, CNBC’s Diana Olick points out that “the national gains, however, belie a deeply disparate state-to-state housing market.”
According to Olick, “Home prices rose dramatically in markets where distressed homes make up the majority of sales. … Meanwhile other states with relatively smaller shares of distressed sales saw prices plunge.”
While it’s great to see strong improvements in the markets that need it the most, we need all our markets to grow and continuing growing. If buyers are truly starved for non-distressed real estate to buy, sellers: why not give them what they want?