Spring is usually the most active time of year for home buying and selling, and this year is no exception. However, a nationwide shortage of available homes in U.S. markets has driven prices up and frustrated buyers who must compete for properties.
The Greater Albuquerque Association of Realtors reported a total inventory of just 617 single-family homes available when it released its February market statistics for the local housing market on March 10, 2021.1 There were 134 fewer available homes than in January, and by comparison, a drop from 1,533 listings in February 2020.
Across California, the available supply of homes for sale also continued to tighten, with all major regions at record low inventory levels not seen in the past 10 years.2
ALBUQUERQUE: SELLER'S MARKET CONTINUES
“The Albuquerque and Rio Rancho markets have done surprisingly well, despite the COVID-19 pandemic. However, with so many people working and schooling from home, office space became one of the most important features for buyers’ 'must-have' lists,” says Amy Neal of ERA Sellers & Buyers Real Estate, a HomeAdvantage® agent. According to Amy, sellers have enjoyed great home appreciation over the past several years, and the trend may continue through 2021. “Many homes are selling above the listing price in today’s market,” she notes.
“Homeowners are enjoying their recently earned equity to gain a home equity line of credit and renovate their current home, especially if moving seems too daunting,” says Amy. “Historically speaking, many sellers make updates to their home to get it ready for selling. I have seen an uptick in “as is” sales, but they are still a relatively small percentage of our market.”
Amy continues, “My advice to home buyers is to be ready! In this market, houses move fast. It’s important to have your loan pre-approval letter ready, so you can submit it with your offer. In an environment where multiple offers and escalation clauses* are very common, being aggressive and creative when negotiating is necessary.”
CALIFORNIA’S TRI-VALLEY: RISING HOME PRICES
“We expected the market would slow down with the lack of access to properties due to COVID precautions,” says Claudia Colwell of J. Rockcliff Realtors, a HomeAdvantage agent in the Livermore, CA area, “but the impact has been completely the opposite. In the Tri-Valley area and surrounding communities, listings are selling very quickly – and usually for significantly higher than the listing price. I expect prices will keep increasing in 2021.”
“People working from home are finding they need more space for offices and areas where children can attend virtual school – space is precious when you spend so much time at home,” notes Claudia. “Homes are selling with multiple offers; our market has gone up 20% just since January. On average, the lack of inventory is driving up prices 7 to 10% over asking price, but some are going for much, much more.”
Claudia advises, “Educate yourself in the local market, find a good local REALTOR® who understands the process and current market trends, then be patient. This is the most difficult market I have worked in my over 34 years in real estate.”
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HomeAdvantage Resources and Rewards
If you’re in the market to buy or sell a home, register for the HomeAdvantage program for free online access to home listings, with information like neighborhood and school statistics and a list of trusted real estate agents. Plus, receive a cash reward*, equal to 20% of the agent’s commission when you use a HomeAdvantage agent and enroll in the program. Learn more and enroll.
*Commonly defined as clause designed to beat competing home offers by automatically increasing your bid a predetermined amount (up to a preset limit) to get above the highest competing offer.
**HomeAdvantage is available to you through your membership with Sunward. Cash Rewards are available to members who register to use HomeAdvantage and who use a real estate agent in the HomeAdvantage network to buy or sell their home. Using Sunward for a mortgage is not a requirement to earn Cash Rewards. Cash Rewards amounts are dependent on the commissions paid to the agent. Sunward may have specific rules on how your Cash Rewards will be paid out. Cash Rewards are void where prohibited by law or the lender. Please consult with your credit union to get details that may affect you.
1. Greater Albuquerque Association of REALTORS®, posted on 3/18/21 (https://www.gaar.com/blog/article/albuquerques-housing-market-remains-tight-according-to-february-report)
2. California Association of REALTORS®, 3/16/21 (https://www.car.org/en/aboutus/mediacenter/newsreleases/2021releases/feb2021sales)
