Real Estate Markets are at an All Time Low With some regions hotter than others
Now is a better time than ever for investors in the real estate market, with homes selling faster than they have in years, as intent buyers clamor to get their hands on the short supply of homes for sale.
According to statistics, homes sold faster in February of 2013 than anytime since 2007, with homes being on the market for an average of 98 days, down from 123 at this time last year. But some markets are much hotter than others.
Markets to watch closely are mostly in California, though Seattle and Denver came in on the top 10 list. With Oakland showing an average of 14 days on the market, according to Realtor.com, and Sacramento just 21 days, the average for the fastest moving markets in the top 10 is roughly 17 days; that’s pretty impressive.
For markets that are seeing low median market times, the average drop-off was 48% from a year ago; most of those in California. According to Realtor.com, the other 146 metropolitan regions that they have data for is at about 16%.
Cities in California aren’t the only regions to keep an eye on, though; Fort Lauderdale, Phoenix, Washington D.C., Detroit, Minneapolis, Atlanta, Dallas and Orlando are also hot on the list, with median days on the market at an average of less than 60.
Phoenix is the current leader in home price recovery, up 23% at the end of 2012, as compared to the same time in 2011. The phoenix market has benefited from strong investor demand, and now Atlanta and Orlando are seeing similar surges.
With such quickly moving real estate markets, sellers and buyers are not as likely to see price reductions on properties as they may have in the past five years, and they can also expect an influx of multiple offers.
The process is changing too; buyers are in such a hurry to get that deal, that they are more likely to waive home inspection contingencies, as well as pay cash for their real estate investment. With cash buyers accounting for 28% of the current market, things can be a little tough for first time home buyers, who typically need to apply for a loan, thus making their interest in the property not as appealing to sellers as that of cash buyer investors.
At a national level, the inventory of homes for sale fell to a 4.2 month supply in recent months, which reflects a 7 1/2 year low; these are great times, and great opportunities, for real estate investors and wholesalers who are on their game and can act fast.