Thursday, June 10, 2021 / by Anne Rose
Kirk Pugh, on the State of the Real Estate market:
These video updates are when I normally give you a bunch of numbers and statistics and tell you how the market is, and my best advice to buyers and sellers. I'm not going to talk about numbers today. Market's great. End of story.
My take away from today's market is, whether you are a buyer or a seller, in today's market it is absolutely vital that you have a seasoned professional helping you, either on the sell side or the buy side.
As a seller, you really need to take a careful, hard look at every offer you get on your home. As a buyer, you need to listen to your advisor and let them help you craft an offer that is likely to be accepted in this hyper-competitive market. It is very fast-paced. It is moving at the speed of light.
There are lots of reasons why we are in this situation. Increased prices due to demand, cost of materials, and cost of labor. Lots, and lots, and lots of reasons, and also because they can.
As a seller, you have an opportunity now, particularly after the last five to six years, to pull some equity of your house if you are not married to your house. There is nothing wrong with taking a quarter of million in equity out of your house and renting for a couple years until the market levels out or the inventory catches up with demand and we start to see some moderation in pricing and some more availability.
Again, as a buyer, you have got to make competitive offers, and I'm not just talking about price. I'm talking about terms, and I'm talking about non-refundable money, and I'm talking about inspection waivers, and escalation clauses - all of the strategies that we are able to use today to actually help our buyers get a house under contract.
As a seller, negotiating dozens and dozens and dozens of showings over a weekend; analyzing in some cases a dozen or two dozen or even a hundred offers on a house in over a short period of time is probably not something I would advise you do on your own.
Suffice it to say, the market is healthy. There is not a wave of foreclosures coming as some people might lead you to believe. The segment of the population that was impacted by COVID with the most dramatic job loss was the service sector (hospitality, hotels, restaurants) which is typically not the largest percentage of people who are homeowners or home buyers, and therefore the rest of the population - the financial services sector, the professional people whose lives - whose livelihoods - where not necessarily impacted by COVID - those people are still in their houses.
Some people took advantage of forbearance because it was a good business decision for them at the time, but people are emerging very quickly from forbearance. There is not a huge amount of defaulted inventory out there. The amount of shadow inventory that is lingering in the banks' balance sheets is minimal compared to what it might have been in 2008-2011, so I see no reasons economic or otherwise for the housing market to decline in value. And, I don't think it's going to stop appreciating in value.
The market is just really, really good right now. As an agent, as a buyer, it's hard. As a seller, it's like Nirvana. It's perfect. Couldn't get much better.
Take that advice if you like. There's not much to add. I could talk about all the numbers and things associated with the market right now, but across the board, nation-wide, in almost every market that I read about, the market is really, really good and there is almost nothing to buy.
If you are a seller, you are driving the bus.
If you are a buyer, get somebody you can trust to help you. Somebody that can help you craft an offer that is likely to be accepted.