One of the positive signs in these troubled economic times is a lack of inventory in the residential real estate business – it shows that homes are bring bought. On top of that, more prospective buyers are out there kicking tires, and making offers, too.
According to a study from real estate specialist Redfin, home tours increased 9% in March 2013 over the prior month – last year’s comp was only 4%. Offers are up 22% over the same period, representing only a slight increase over last year’s 21% gain.
However, Redfin pinpointed an interesting pattern – the increase in offers made during the last week of March compared to the first week was 16% — that compares to only a 3% gain during the same period in 2012, and Redfin says this “drastic” increase “indicates an extremely competitive homebuying season and likely gains in April and May sales.”
The increased house-hunting activity combined with a drop in inventory has had the predictable effect of increasing sales prices, up 13% YOY in February. It has also led to “flash sales” in which some properties find a buyer within hours of going on the market.
Redfin concluded, “Today’s data on demand tells us that even though homebuyers are frustrated with market conditions, they are resilient, continuing to tour homes and offer on them, despite the fierce competition. Homebuyers’ persistence, paired with increasing confidence among home-sellers, bodes well for the market as a whole. Redfin agents are optimistic that as home prices continue to rise, more homeowners will choose to list their homes, easing the inventory crunch and providing the level of sales volume necessary for the housing market to reach a true recovery.”
RBR-TVBR observation: The sale of a home puts a lot of related retail action in play. People moving into a new residence will put all kinds of items on their shopping list, for both the interior and exterior of their new residence. It the action is particularly hot and heavy in your market, it would be wise to remain in close contact with your friends in the furniture, home improvement and hardware businesses.