RMLS Market Action reported the highest level of inventory in recorded history this month. Inventory is calculated by taking the current number of active listings and dividing it by the number of closed sales (14,006 listings/732 closed sales). In January 2006, there were 6.2 months of inventory. Between March and September of 2005 inventory never got above two months.
If you are a seller, the competition is plentiful. Buyers have lots of options when looking at property and as there are fewer buyers in general they can be picky. Nobody’s perfect, we had an agent that couldn’t get the door open at our property this week, we’re having the lock worked on tomorrow. It’s not broken but nor is it easy to open (mortise locks are counter intuitive to start with).
Even getting to the front door proved challenging this week. We made appointments to show a buyer property over the weekend with more than 24 hours notice. Three of the owner occupied properties would not allow their house to be shown. For one reason or another, it wasn’t convenient for them. Unfortunately, it wasn’t convenient for the buyer to reschedule so those houses were not shown.
Once you get them in the door, you’ve got to give them a reason to stay. Antidotely, we are seeing buyers want houses in move-in condition more than they are wanting projects. I think there are numerous reasons for this but much of it is financial. In an era of loose lending, buyers could purchase the hose for less out-of-pocket. Now qualified buyers are putting more money down on the purchase and therefore have less access to cash for projects. If the seller has already done the project, the value is in the property and the project can financed into the purchase. This assumes that the buyer sees the value in the projects the seller has done. Blanket statements don’t cover the whole buyer spectrum but this appears to be the current trend.
It’s a buyer’s market so sellers need to consider what they need to do to outshine the competition. That doesn’t necessarily just mean on price.