LIME REALTY GROUP has decided to do a series of blog entries on the housing shortage we’ve been hearing about in the news recently. We hope you’ll find out insights helpful in understanding this confusing and complicated topic and how to view it from multiple angles.
Right now, there is a solid demand for properties. Especially in areas that are experiencing significant growth. Southern Utah is one of those areas, so we can say for sure that demand is something we’re seeing on a regular basis.
Because demand is strong, it’s a sellers’ market and there’s little incentive for a seller to reduce their asking price. From December through February of this year, there were less than four months’ supply of existing houses on the market nationwide. Of course that figure is slightly different for our market but not by much.
The most important thing to realize about this is that right after the recession in 2010, there were approximately 12 months’ worth of housing on the market. A lot of that inventory got snatched up by investment buyers in short sales. They quickly drained the markets of troubled properties creating a more lean supply in subsequent years.
The houses sitting on the market for extended periods of time are often homes that are asking more than they’re worth. If the price is within the industry standard for that area, they usually get snatched up fairly quickly. We’ve seen this happen often.
You should also be aware, that income growth isn’t keeping pace with the rising property values. So that’s moving a lot of interested buyers out of the market. However, with rental properties doing a brisk trade, investors will continue to snatch up reasonably priced homes at a steady pace.
Tomorrow we’ll discuss this trend a little more and offer more insight. For now, consider calling the clear choice in real estate in the Southern Utah area. Call Lime today!