Low housing inventory, eroding affordability and rising interest rates made pending sales on a year-over-year basis for the month of February suffer after a good start to the year in closed escrow sales. Also, sellers simply aren’t selling.
They did see elevated market activity, but the Bay Area pending sales specifically were down year-to-year for the fifth straight month. According to the release, the Bay Area has been plagued by a shortage of homes on the market and poor affordability.
We have seen an increase in listings starting in April, but with pent-up demand, buyers are getting frustrated losing out in multiple-offer scenarios and with ever-increasing prices.
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Whether you’re buying or selling a home, there will almost always be inspections done. Oftentimes, buyers will do roof, home, and pest inspections. Sometimes fireplace, foundation and sewer lateral inspections will be conducted as well.
Buyers are trying to determine the integrity of the house they want to buy – nobody wants to buy a home only to find out later that they will have to put additional money into it. However, sellers rarely know about these things off the top of their heads.
That is why it’s important, and beneficial to both parties, for inspections to be done. At the very least, a seller should do a pest inspection before going on the market to understand the cost of any issues, rather than deal with negotiating after something is discovered.
Once inspections are done, they become a disclosure. So, if a buyer gets scared off for some reason, the inspections are a disclosure for the next buyers. More than likely, this will incentivize the seller to work with the existing buyer. Occasionally, there are bad inspections with unreasonable pricing and there is no coming to agreement between parties. The seller will usually get another inspection from a more reputable inspector.
The California Association of Realtors (C.A.R.) report that 69 percent of Americans are looking for ways to simplify their lives. Furthermore, they say, 74 percent of Americans will walk out of a store – even if they have exactly what that person is looking for – if the service is poor. And 45 percent of U.S. consumers say they are likely to pay for a service that provides extra convenience in their lives. See their graphic below:
So, what’s the conclusion here? Consumers value time, and therefore convenience. This also translates to buying a home. Home buyers these days, especially millennials, want updated and move-in ready homes. They want properties conveniently located nearby public transportation or in an area with a high walking score.
As a seller, taking care of deferred maintenance, updates or remodeling will appeal to these convenience consumers. Though you can’t change the location, you can highlight positive conveniences. As a buyer, know that living without some of these things may either get you a home or a better deal.