Have you always wanted to upgrade to a luxury home? Right now, the luxury housing market is in a buyer’s market, while lower priced housing tends to lean more towards being a seller’s market. It’s a great combo for an upgrading buyer!

Want to Keep up with the Joneses? Now’s the Time

Does your current house fit your needs? Does it seem like everyone else is moving up and moving on to more luxurious surroundings? Are you wondering what it would take to start living your dream life?

Market conditions around the country have presented an opportunity like no other for those who are looking to make the jump to a premium or luxury home.

The National Association of Realtors reports that national inventory levels are now at a 4.3-month supply. A normal market, where prices appreciate with inflation, has 6-7-months inventory. The national market has echoed the conditions felt in the starter and trade-up markets as inventory has declined year-over-year for 25 consecutive months.

The chart below shows the relationship between the inventory of homes for sale and prices.

According to Trulia’s latest Inventory Report, the inventory of homes for sale in the two lower priced markets has dropped by double digit percentages over the last 12 months (16% for starter and 13% for trade-up homes). While the inventory of homes in the premium home category has dropped by only 4%.

This has created a seller’s market in the lower-priced markets, as 54% of homes were on the market for less than a month in the last Realtors Confidence Index, and a buyer’s market in the luxury market, where homes were on the market for an average of 160 days according to the Institute for Luxury Home Marketing.

Bottom Line

If you are even thinking of listing your home and moving up to a luxury home, let’s get together to evaluate your ability to do so. Homeowners across the country are upgrading their homes, why can’t you? Your dream home is waiting!

Housing inventory is still fairly low…which is causing some buyers to put the brakes on their moving plans…

Inventory Drops Again, Sales Slow [INFOGRAPHIC]

Highlights:

• Existing Home Sales are now at an annual pace of 5.52 million.
• Inventory of existing homes for sale dropped to a 4.3-month supply, marking the 25^th month in a row of declines.
• The median price of homes sold in June was $263,800. This is the 64^th consecutive month of year-over-year price gains.

Housing inventory remains low. Buyer interest remains high. Thinking of selling? It’s time to take action!

3 Charts That Shout, ‘List Your Home Today!’

In school, we all learned the theory of supply and demand. When the demand for an item is greater than the supply of that item, the price will surely rise.

SUPPLY

The National Association of Realtors (NAR) recently reported that the inventory of homes for sale stands at a 3.8-month supply. This is considerably lower than the 6-month supply necessary for a normal market.

 

DEMAND

Every month NAR reports on the number of buyers out in the market looking for homes, which is also known as buyer traffic. As seen on the map below, buyer demand in March was strong or very strong in 45 out of 50 states nationwide, and Washington, DC.

Many buyers are being confronted with a very competitive market in which they must compete with other buyers for their dream homes (if they are even able to find a home they wish to purchase).

Listing your house for sale now will allow you to capitalize on the shortage of homes for sale in the market, which will translate into a better pricing situation.

HOME EQUITY

Many homeowners underestimate the amount of equity they currently have in their homes. According to a recent Fannie Mae study, 37% of homeowners believe that they have more than 20% equity in their homes. In reality, CoreLogic’s latest Equity Report tells us that 78.9% actually do!

Many homeowners who are undervaluing the equity they have in their homes may feel trapped, which may be contributing to the lack of inventory in the market.

Bottom Line

If you are debating selling your home this year, let’s meet up to evaluate the equity you have in your home, as well as the opportunities available in your market.

Housing inventory remains low, especially in starter & move-up markets. Buyers continue to snatch up the good homes, and a slight seller market is appearing in select areas.

A Tale of Two Markets: Inventory Mismatch Paints a More Detailed Picture

The inventory of existing homes for sale in today’s market was recently reported to be at a 3.6-month supply according to the National Association of Realtors latest Existing Home Sales Report. Inventory is now 7.1% lower than this time last year, marking the 20^th consecutive month of year-over-year drops.

Historically, inventory must reach a 6-month supply for a normal market where home prices appreciate with inflation. Anything less than a 6-month supply is a sellers’ market, where the demand for houses outpaces supply and prices go up.

As you can see from the chart below, the United States has been in a sellers’ market since August 2012, but last month’s numbers reached a new low.

Recently Trulia revealed that not only is there a shortage of homes on the market in general, but the homes that are available for sale are not meeting the needs of the buyers that are searching.

Homes are generally bucketed into three groups by price range: starter, trade-up, and premium.

Trulia’s market mismatch score measures the search interest of buyers against the category of homes that are available on the market. For example: “if 60% of buyers are searching for starter homes but only 40% of listings are starter homes, [the] market mismatch score for starter homes would be 20.”

The results of their latest analysis are detailed in the chart below.

Nationally, buyers are searching for starter and trade-up homes and are coming up short with the listings available, leading to a highly competitive seller’s market in these categories. Ninety-two of the top 100 metros have a shortage in trade-up inventory.

Premium homebuyers have the best chance of less competition and a surplus of listings in their price range with an 11-point surplus, leading to more of a buyer’s market.

“It leaves Americans who are in the market for a home increasingly chasing too fewer options in lower price ranges, and sellers of premium homes more likely to be left waiting longer for a buyer.”

 Lawrence Yun, NAR’s Chief Economist doesn’t see an end to this coming any time soon: 

“Competition is likely to heat up even more heading into the spring for house hunters looking for homes in the lower- and mid-market price range.”

Bottom Line

Real estate is local. If you are thinking about buying OR selling this spring, let’s get together to discuss the exact market conditions in your area.