Technology can solve many problems, and it certainly makes it easier to conduct business in an organized and cost-efficient way. But there are problems — or maybe I should call them challenges — that no one has an app for.
Right now there are not enough homes on the market in my area. Buyers who want to work with me are asking for help finding that perfect home, and I am struggling to find a home that might work for them.
Normally I would be showing at least 10 homes on an average weekend in January. I met with one buyer last weekend. This weekend I am scheduled to show one property that’s a long shot for this particular client, and we both know it.
It is just wonderful that interest rates are low and my buyers are preapproved and ready to go. Except we are not going anywhere because I don’t have anything to show them right now.
Each morning, I walk from my bedroom to my office. After stopping at the coffee pot on the way, the very first thing I do when I log on to my computer is look for new listings. On a good day there are 15 to 17 new listings.
Not a lot to choose from — especially considering that is for the entire city, and encompasses all price ranges and housing styles.
Currently there are only 793 homes on the market in St. Paul, Minn., and only 614 that don’t already have offers on them. You’d expect at least twice as many homes to be on the market, and 2.5 times more listings would be better.
Active listings in the St. Paul, Minn., market, January 2003-2013
The number of homes on the market has gotten smaller in each of the last several months, but the number of buyers is remaining fairly steady. Prices have gone up, but only a little.
This isn’t like 2006 when buyers would outbid each other to win the home they wanted. If buyers offer more, they have trouble getting loans approved because of low appraisals.
Listings are getting a lot of showings, but it isn’t like it used to be when we could expect an offer after 10 to 12 showings. Perhaps buyers are leaving no stone unturned and looking at homes that they would ordinarily ignore.
The homes that are selling the fastest are low-priced foreclosures and fixer-uppers, and we are slowly running out of them. I know dozens of people who would love to sell their homes, but they will not or cannot because they’re underwater, i.e., they owe more on their homes than they could sell them for.
In an attempt to get some more listings, I recently reviewed all of the listing appointments I had last year with sellers who didn’t end up listing with me. In most cases, the homes were never put on the market. One is now owned by a bank.
As I reviewed my notes, it looked like in many cases the potential sellers could not afford to sell their homes or did not want to take a loss and so they still own their homes. Some moved on and are renting their homes out. I am in the process of contacting each of them to see if they are still interested in selling.
Yesterday I was delighted when a prospective client called looking to sell a unit that’s exactly what one of my buyers is looking for.
The appointment before that did not go nearly as well. I was told by a seller that she "has" to have an amount for her home that’s about 40 percent more than the market will bear right now. The seller said she’s willing to wait for the home to appreciate, no matter how long it takes.
Right now there is about a three-month supply of homes on the market. Six months is often said to represent a better balance of supply and demand.
There are fewer Realtors than there were last January, too, but not half as many. It isn’t at all unusual right now for an experienced agent to have no listings.
Employment rates are better than they were last year, and now that we are past the presidential elections and some of the fiscal cliff angst, home values should start to rise. As they slowly rise I hope some of those people who want to move will put their homes on the market, so that we all have something to sell.
I talk to other agents around the country, and many of them see the lack of inventory as one of their main business challenges right now.
I, for one, plan to spend more time reaching out to potential sellers, especially those I know and who have contacted me in the past two years.
The inventory of homes on the market continues to fall. There are fewer homes on the market today than there were on Jan. 1.
Teresa Boardman is a broker in St. Paul, Minn., and founder of the St. Paul Real Estate blog.
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