With the national numbers of new home starts and application for construction permits down we are noticing that inventory of existing homes is shrinking. So how can buyers and sellers take advantage of this? I discussed this with Rosemary Frisino Toohey of WTOP live. You can listen to the interview in it’s entirety by clicking on the WTOP Logo to the left.
For sellers I think these past 3 months may have been the best 3 months to have put your home on the market and I think this window is still open and will remain open through the summer and into the Fall market. To take advantage of smaller inventory in our area I suggest listing your home with an experience agent and following all the suggestions I’ve made in past blogposts (ie pricing and positioning your home correctly, working on the house prior to going live so it’s in the best shape you can possibly get it into within an acceptable budget and timeframe, staging the home so it shows at its best etc). If you do everything correctly you should be able, in this market, to get your home sold quickly close to, at, or even above asking price. Take shortcuts in any of the above and you may find yourself at the very other end of the spectrum, sitting on the market for a long time with the need for multiple price drops.
If you’re a buyer one way to take advantage of this market is to change your must have list. Read the previous paragraph again and understand that there are homes on the market where sellers took shortcuts. So you may see homes that don’t show well, or need some work (both cosmetic (minor) or structural (major)) or are priced wrong. If you are willing to see beyond this and maybe take on some projects (ie kitchen renovations, bathroom updates etc) you may find yourself in a position to negotiate a great deal for yourself. So what other buyers may have passed over due to lack of willingness to take on what appears like a “project” may be your opportunity to get a truly great deal.
So what will it take to get inventory up? I think that inventory is actually at a healthy balance right now. The local absorption rate seems to be roughly around 4-5 months by my experience . I think that as more media coverage of the local state of the market gets out we’ll see more sellers willing to put their homes on the market and even more so perhaps the confidence of builders and developers of smaller projects picking up again which will increase the inventory.
Either way in my humble opinion I don’t think too much will change between now and the Fall market, creating what for us in the local DC Metro market is a great opportunity for both sellers and buyers.