Today’s housing market is totally different than few years ago even a year ago. It is now sellers market in many metro’s. Due the demand, sellers are either setting their asking price higher than appraised value or don’t want to sell now below their asking price. They don’t even want to come to the table for negotiation any more. That’s how the market has become in many cities.
The same situation prevails in and around Houston areas, it is mainly due to less inventory, pricing war and way too much price increase by new home builders turning buyers to preowned homes. While sellers know that there are more buyers in the market and less homes to sell, they are trying to price high to take advantage of it. If the location is hot, buyers are willing to pay for it and close the deal. Especially Memorial Heights, Sugar land areas resale homes don’t even stay in the market for a week or so. Many buyers are willing to pay more to take advantage of the lower interest rate. That’s the top answer from a survey conducted by RedFin.com.
For the latest Redfin Real-Time Home-Buyer report, they surveyed 1,353 active homebuyers who have recently toured homes with Redfin, in order to get their pulse on the market. Respondents came from across 22 metropolitan markets in the US like Atlanta, Austin, Houston etc.,
Key findings of this quarter’s report include:
Low interest rates was still the top factor in why buyers want to buy now, selected by 58% of respondents, but rising prices shot up seven percentage points from 33% in the fourth quarter to 40% in the first quarter–the same share that “low home prices” was at when we launched this survey a year ago.
Moving toward consensus that this is a seller’s market: Just 31% of buyers believe now is a good time to buy in their neighborhood, down from 40% last quarter. More than twice as many–67%–see now as a good time to sell, up from 48% last quarter.
Increasingly willing to pay more: Forty-one percent of buyers indicated that low inventory has caused them to consider paying more for a home, up from 34% in the first quarter and just 26% in the fourth quarter.
Homebuyers anticipating further price increases remained unchanged: The percentage of homebuyers who anticipate further price increases in their neighborhood remained virtually unchanged from last quarter. Both quarters, 79% indicated a belief that prices will increase in the next 12 months. This quarter, 23% think prices will rise “a lot,” up just slightly from 22% last quarter.
Rising prices are an increasingly common concern: Forty-eight percent of buyers listed rising prices as a major concern, up from 40% last quarter.Sixty-five percent cited low inventory as a major concern in the first quarter, down slightly from 66% last quarter.
The most common themes we heard from buyers this quarter were frustration with low inventory, intense competition, and speed at which homes are selling. This is no surprise, with a third of new listings being sold within two weeks or less in April.
Check out the full report at blog.redfin.com
In conclusion, I like to add that market is driven by supply and demand. More supply, less demand few years prices ago so prices are way too low. A sudden surge in home buying activity due to economy creating a void in inventory bringing down the supply and demand continued to grow making this pressure in the housing industry for price bubble in many areas. We can only hope its a realistic bubble and not a man made one to sustain and settle down for longer term steady growth in the housing industry for the betterment of the consumers.