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Replies (2)
- klarek the realist
- Contributions:7044
I'm seeing new listings in my area at a pace I've never seen before, and I watch this stuff like a hawk. In the zip I look at, typically I'd see 5-10 listings per week in peak season, 5 or less during the winter. Absorbtion would be more or less the same over time. Now I'm seeing 20+ new listings per week, consistently, going on for about two months, and hardly any have gone under contract.
Where are all the buyers? Oh yeah, they jumped into the tax credit volcano and overpaid for their homes. I'll enjoy buying with no competition.
Where are all the buyers? Oh yeah, they jumped into the tax credit volcano and overpaid for their homes. I'll enjoy buying with no competition.
- RichardReid
- Contributions:197
Supply and demand are fundamental economic principles to be sure, but the current market is far more complex.
As a general trend, housing prices have continued to fall / stabilize, while listing numbers have plummeted from their highs. The number of homes shrinking by as much as 40% would typically have a corresponding rise in prices, but this has not been the case.
If you want to look at supply and demand as the sole driver, you may get away with it with respect to foreclosures and short sales. The number of homes available through these vehicles is far greater than normal, and promoted much more publicly than normal.
These sales skew the market perception of pricing. Buyers only want the great deal, but typically not the condition that goes with it. Sellers who are not banks willing to sell at a huge loss play a game of patience.
Quality homes in good, well developed neighborhoods are still selling at reasonable prices. If your home is located in a new development with large inventories, or a market plagued with high foreclosure and short sale rates, play the other side of the supply cycle - and rent your property out. Rental rates and demand are on the rise as those who cannot afford or choose not to buy drive the need for rental property.
As a general trend, housing prices have continued to fall / stabilize, while listing numbers have plummeted from their highs. The number of homes shrinking by as much as 40% would typically have a corresponding rise in prices, but this has not been the case.
If you want to look at supply and demand as the sole driver, you may get away with it with respect to foreclosures and short sales. The number of homes available through these vehicles is far greater than normal, and promoted much more publicly than normal.
These sales skew the market perception of pricing. Buyers only want the great deal, but typically not the condition that goes with it. Sellers who are not banks willing to sell at a huge loss play a game of patience.
Quality homes in good, well developed neighborhoods are still selling at reasonable prices. If your home is located in a new development with large inventories, or a market plagued with high foreclosure and short sale rates, play the other side of the supply cycle - and rent your property out. Rental rates and demand are on the rise as those who cannot afford or choose not to buy drive the need for rental property.
Housing Basics: Massive Supply, Faltering Demand
link
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