The LA Times today reported that existing home sales slid 6.4% to the lowest level in nearly six years, the lowest pace in three years. Sales last month fell in all four of the nation's regions. INVENTORY is the most significant issue in real estate. Homes for sale are so low buyers are leaving the market with the comment of too few choices.
Homes are not coming on the market as they have in the past.
1. Coming off the recession there were more homes as so many had been financially stretched to the limit, we were in the 'forced sale' segment. Simplistically, the vast majority of the real estate holding were overpriced in the post 2008 years; hard to sell, selling at a loss, need for personal liquidity due to the overall decline in national net worth.
2. The under value shakeout was near complete and positive values showed up in about 2015. Homeowners with comfortable liquidity thought waiting might bring their sale price back to the 2006 price peak. At this point be mindful that every area of the country , Southern California and our resort Lake Arrowhead had a somewhat different picture of the 2015 recovery.
WHERE DO WE GO FROM HERE?
"Inventory will continue to increase, but unless there is a major shift in the economic trajectory, we don't expet a buyer's market on the horizon within the next five years," says Danielle Hale, chief economist at realtor.com.
A home shopper needs to find only one home to have the joy of a lifetime. The key is the best go first. For a buyer to find the 'best' he/she must be tuned up, knowing the market so well that when they see 'the one' write a check for a very good offer on the house immediately. But you must have seen enough homes, identified your yes and no, and be ready to act now!
We'll chat about price another day. CHEERS, Bob