Real estate tips: Low inventory, perfect storm?

sponsored post by Lauren Hruby and Scott DeVouton

The real estate market is improving.  More and more buyers are ready to pull the trigger. However, a phrase we hear a lot right now is that there is “low inventory” in the housing market.  What is low inventory?  How does it affect you?

Inventory is usually associated with the retail industry, but it applies the same to real estate.  Just as a grocer keeps count of the amount of food it has to sell, real estate markets keep track of how many homes a community such as Kansas City has to sell.

Right now, there is a shortage of existing homes for sale.  This “low inventory” means it’s a seller’s market: there are more buyers than sellers right now, about 10% less than this time last year.

What does it mean to you?

Sellers – or those thinking about selling – are in the best spot they’ve enjoyed in a while.

• Interest rates are still relatively low, so it costs less for someone to buy your home.
• It appears people are feeling more secure about employment and future income.
• Home values are also up, 16% this January compared to last January.

For sellers, there is a good combination of supply and demand right now.  However, it is important to get on the market in time for the moving season.  Sellers are encouraged to talk to a realtor now, to give enough time to prepare for listing.  It’s a seller’s market, but you have to still have to work at it.

Buyers are in the position to purchase a home, but have to work to find good properties.

• Again, interest rates are still relatively low.  For a long-term purchase like a house or condo, low rates will mean thousands in savings.
• Because of the market’s low inventory compared to volume of buyers, homes are going quick.
• Despite the recent improvement in the housing market, home prices are still relatively low.  We are still improving, after all.

Buyers will have to put extra work into their home searches, but the right place is out there for the right price.  Talk to a lender and realtor immediately, however.  Buyers who don’t have their ducks in a row will miss out.  This will compound as the season develops.  Trends indicate it will be a busy summer, so get started now.

Finally, we can report that recent warmer weather has led to more activity from both buyers and sellers.  We are saying the same thing to them as we’ve written here.  If more people decide to list their home this year, we could see the perfect storm for continued growth in the housing market.  That would be good news for everyone.

Lauren and Scott are with Lauren Hruby Real Estate, Keller Williams Realty Key Partners, LLC.  They work with people looking to sell or buy a home in the Kansas City area.  For more information, visit www.laurenhruby.com or call 816-529-6174.