June, July and August could be the last opportunity for buyers to have the “upper hand” for real estate purchases. A few years from now potential buyers could look back and say they should have bought some real estate in the summer of 2008.
There are a number of “mini” indicators that are taking place at ever-increasing rate. Numbers of sales, although still modest, have increased each month for the past five months.
Supply and demand controls most real estate markets. For the past three months the supply of resale homes on the market has reduced by about 10 percent. This is significant since usually during the springtime the inventory increases giving buyers more selection. Some of the reduction is from non-motivated sellers going off the market. The remaining sellers are more motivated giving buyers some real buying opportunities. Already previews and showings on existing inventory have increased. This decreasing inventory shows a real change in our local real estate market.
Decreasing interest rates and higher loan amounts are helping to make real estate more affordable and are helping people refinance difficult adjustable loans. Financing availability is critical in purchasing real estate.
Realistic sellers are reducing prices or going off the market if the need is not strong to sell. Some sellers still cling to an outdated mentality when it comes to pricing hoping to achieve the sky-high prices that were common at the height of the housing boom, but this group is getting educated. Lower prices continue to release the logjam of resale real estate and give buyers a more reasonable selection.
Through the summer months, inventory, prices, and interest rates should start to put buyers and sellers on an even playing field for negotiations. This will put us into a leveling out of sales activity, prices and reasonable negotiations between buyers and sellers. This “normal” phase may continue for a year or two. Buyers should enjoy this “Summer of Opportunity”.
For additional real estate assistance or advice, please call Dody Rogers, Re/Max of Santa Clarita at 661-702-4515, ext. 5012.
