October 2nd, 2012 4:13 PM by Lori Speight
Low inventories of homes for-sale are becoming troubling to home buyers, Inman News reports. Almost every major market in the U.S. has posted double-digit decreases in for-sale listings.
"The buyers tend to become a little frustrated as they are seeing homes that they want to 'think about' and before they can even get home to discuss it there are already multiple offers on the property," Sheri Moritz, a real estate broker with Keller Williams' Wake Home Team in Raleigh, N.C., told Inman News. In Raleigh, inventories have fallen 21 percent in the past year, according to Realtor.com data.
"I counsel buyers to be patient, and not get discouraged, that it may take extra time to find the suitable property," adds Tom Avent, broker-owner at Tom Avent Real Estate in Fresno, Calif., which has posted a 43.1 percent drop in inventories in the past year. "I have also seen some buyers give up looking, frustrated with low inventory and losing out in multiple-offer bidding."
Multiple bid situations are a common occurrence in many markets. But surveys show that home buyers lose their enthusiasm when faced with competition for a property, according to a recent survey by Redfin. Seven in 10 of home buyers surveyed reported that they’ve faced competition on at least one of their offers recently, but 31 percent say they would back off when faced with a multiple offer situation for a home, according to the Redfin survey.
Charles Roberts, a director at the Denver Board of REALTORS® and co-owner of Your Castle Real Estate, says that “urgency” is the new landscape greeting home buyers.
"Gone are the days of looking at 50 homes and taking months to make a decision,” Roberts told Inman News. “If there's a good property on the market, buyers need to act quickly, and yes, sometimes bid above asking price. The educated, thoughtful clients are getting great deals with astoundingly low interest rates. The clients that are still insisting on putting offers at 80 cents on the dollar are getting shut out of the market. They either learn that that strategy doesn't work anymore or they keep on renting. Our job as real estate agents is to teach them what the market looks like and guide them in their decision-making."
Source: “Low Inventories Thwarting Buyers,” Inman News (Oct. 1, 2012)