The hysteria to buy a house in the US: homes barely last a week for sale

If you think about it, you are homeless. This is the mantra that is being installed among Americans looking to buy a new home in recent months. The tightness of the market means that buyers have to quickly pounce on a property without probing many more options. How quickly you have to make a decision for fear of being left without an alternative because another has been faster or has offered more is being the predominant note.

The figures speak for themselves: between July 2020 and June 2021, homes for sale were kept with the ‘for sale’ sign for an average period of just one week before signing a contract, according to a survey published this Thursday by the National Association of Real Estate Agents. This figure is lower than the average three weeks of the previous year and marks a historical low in the available data, which dates back to 1989. To get an idea of ​​the contrast, in 2012 a house had to be for sale on average about 11 weeks before closing a trade.

The explanation must be sought, once again in the pandemic. Americans starred the great ‘rotation’ of households. The lockdown led many to seek larger or more comfortable homes, adding to an environment of low interest rates and the fact that many citizens kept their income from state aid. Many households also saved more during the pandemic and benefited from a rising stock market.

At the same time, the offer was limited. Caution when showing homes during COVID-19, the reluctance of some homeowners to enter the competitive housing market, and the ability to refinance at low interest rates prevented many potential sellers from listing their homes.

He continues it housing shortage in the market makes many buyers stay on the sidelines. About two-thirds of active buyers have been looking for a house for at least three monthsaccording to a September survey by the National Association of Home Builders (NAHB). About 45% of those buyers said they were unsuccessful because they continued to be outbid by other buyers.

In such a tight market, buyers have little time to hesitate and think slowly about what is possibly the biggest purchase of their life. How it echoes The Wall Street Journal, these rush leads some buyers to forgo traditional warranties. There are cases in which the right to terminate a contract for a low appraisal or an unfavorable inspection is waived in order to make your bids more competitive in this ‘bidding war’. “In this scenario, you can’t even think about where the Christmas tree will be or whether a sofa will fit,” laments Jessica Lautz, vice president of demographics and behavioral perspectives at NAR. “You really are making that decision very fast.”

Of course, there are small ‘aggravations’ that make the situation more pressing. The tools that allow buyers to visit homes remotely and schedule visits online They also helped speed up the home buying process last year, according to realtors. A large proportion of cash buyers, including investors, are also contributing to the fast-paced market, they say.

Another piece of information that I speak for itself is that of the final sale price. Homes typically sell slightly below their listed price, but in the year ending in June the median sale price was the full price, the highest since the NAR began recording the data in 2002. The median sale price in that period was $ 305,000, up from $ 272,500 the previous year.

Desperation is driving some seekers from home to take advantage of winter holidays. It is a time when buyers prefer not to move, so some expect the market to slow down on those days and find less competition, he says. WSJ Mike Miedler, CEO of Century 21 Real Estate LLC.

Although this reason seems to be causing the market to cool slightly, some agents note that the difference is minimal. “Instead of a house lasting three days on the market, it is lasting seven days,” says Harold Torres, a real estate agent in Orlando, Florida.