Seller’s market: Number of houses for sale remains low
Lack of available homes plus rising cost of building materials push prices to record highs
SHREVEPORT, La. (KSLA) — Fewer homes are on the market, giving sellers the advantage over buyers when negotiating sales these days, analysts say.
If you’re looking to buy, you have to do it fast; and if you’re looking to sell, it’s a perfect time,” real estate agent Rhalanda Jackson said.
“It’s an exciting time because we have multiple offers coming in pretty much on every home. Homes are hitting the market; they are selling overnight,” Jackson explained. “If you’re a buyer, it can be frustrating because buyers are falling in love with a home only to get beat out.”
Sabrina Scott, who is moving into her new home, said it was not easy to find one. “There were a few disappointments along the way.”
It motivated her to build.
“There was a home that we were interested in that had a lot of the amenities that we were looking for; however, it was overpriced,” Scott explained.
Mortgage rates recently declined slightly, pushing the benchmark 30-year home loan back below the 3% mark in late May, The Associated Press reports. Mortgage buyer Freddie Mac reported May 27 that the average for the 30-year rate fell to 2.95%, down from 3.15% at the same time in 2020.
According to the Mortgage Bankers Association, mortgage applications saw a 4% drop from one week earlier.
“Right now, our industry average is about 3.3%. You can still get a rate under 3.3%. But look for the rates to tick up.” mortgage lender Herman Hudson predicted.
Despite those rates, a lack of supply of homes led to fewer Americans signing contracts to buy homes in April, the most recent month for which figures are available.
The National Association of Realtors told The Associated Press that April was the third sluggish month in a row after nearly a yearlong rebound from the depths of the COVID-19 pandemic last spring.
While many people are looking to upgrade to a new home, not as many are willing to sell their current homes, The Associated Press reports.
The resulting lack of available homes for sale coupled with higher costs for building materials have pushed prices of new and existing homes to record highs.
“Right now, you continue to see housing prices increase due to the price of lumber,” Hudson said.
The lack of available houses adds to that.
“According to Zillow, you got 2.5 million homes in the shortage back in 2018; and if you fast forward to 2020, there were 3.8 million. That’s about a 52% increase,” Hudson said.
“So the prices are going to continue to go up because of the shortage. And the price hike is passed down from the manufacturers and down to borrowers.”
In April, there was record high demand for houses but a record low inventory of houses in Bossier, Caddo and DeSoto parishes, according to Shreveport-based Coldwell Banker Gosslee.
“It’s a case of supply vs. demand that continues to drive home prices up and create the ‘quickest’ market likely in our local history,” says the Realtor’s most recent housing market update.
Bossier, Caddo and DeSoto parishes had 774 homes on the market in April, representing a 54% decline in available inventory when compared with the previous year, the report states. That equates to a 1.6-month supply of homes, an all-time low.
“This essentially means that if no more homes come on the market, we would see our supply dwindle to nothing within a bit more than 45 days,” the Realtor predicted.
There was a 4.2-month supply of homes at this time last year and a 5.4-month supply two years ago. At those levels, the report explains, neither the buyer nor the seller generally has the advantage.
Following are a few more observations from the Coldwell Banker Gosslee housing market update:
HOW LONG ARE HOMES STAYING ON THE MARKET?
- 511 homes sold in April in Bossier, Caddo and DeSoto parishes.
- The median number of days that those homes were on the market is 10 days. That’s down 86% from a median of 72 days a year ago.
- The National Association of Realtors said 17 days was the median number of days in April nationally.
HOW MUCH ARE BUYERS WILLING TO PAY?
- The $100,000-$200,000 price range had a 1.1-month supply.
- The most popular price range is $200,000-$300,000. Only 106 homes, a 0.8-month supply, were available at the time of the report.
- There were 52 homes for sale at $400,000-$500,000 (a 3.4-month supply) and 97 homes for sale at $500,000 or more (a 6.5-month supply).
INTERACTIVE: You can use this map from the National Association of Realtors to access data about the housing markets in your area and elsewhere in the country ►
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