Low Housing Inventory Changing the Game This Holiday Season
LOS ANGELES, Dec. 19, 2012 /PRNewswire-iReach/ -- Even though websites like Realtypin.com have over one million listings on them, the inventory of available homes around the country is much lower than it should be in a "healthy" economy. While that's a concern for the housing market as a whole, it's making a dramatic difference this holiday season.
First things first, though. Just how low is the current inventory?
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That depends on where you look. Typically, real estate experts consider a "fair" inventory (meaning one that doesn't favor buyers or sellers) to be enough homes to sell in six months' time, at the current selling pace. In some metros, though, the inventory is only a month or so.
And, with Christmas getting closer and closer, the inventory is getting lower and lower.
That's because most sellers don't want the hassle of having their homes for sale over the holidays. Instead of fretting over which decorations could potentially offend buyers, worrying about showings instead of presents, and trying to balance keeping the house clean with houseguests, many would-be sellers wait until the first of the year to put their homes on the market.
Historically, the fourth quarter is always slow for the housing market. Now, when you throw in a housing market that's already struggling, it's easy to see why the inventory is so low!
But don't go crying in your Egg Nog over the state of the housing market just yet. There is an upside to this low inventory.
Think back to your high school economics class and your teacher's discussion on supply and demand. What happens when the supply shrinks?
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The demand goes up!
Even though the inventory is low around the country, there are still buyers out there. And, since many of them want to get a deal done before the end of the year (and take advantage of the tax breaks that come along with buying a house this year, instead of waiting until April 2014 to put certain deductions on their tax returns), they're fighting over the small number of available properties that are out there.
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That means some places are actually seeing bidding wars!
In Orange County, California, for example, the current median sales price is $459,000. That's 12% higher than it was this time last year, simply due to the bidding wars that are going on there. Right now, realtors there are predicting that this fourth quarter could break sales records, all thanks to the low inventory.
Talk about a silver lining, huh?!
Media Contact: james paffrath RealtyPin.com, 1-(866) 960-8649, firstname.lastname@example.org
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