While the Albuquerque real estate scene is predominantly full of good news these days, one aspect never seems to improve and steadily worsens - low inventory of available homes for sale.
For sellers who are on the market in times of such short supply, this represents a truly golden opportunity.
Less choice means that buyers may be forced to pay more for a home and concerns over ever reducing supply of homes in the area means they are also more likely to make a fast purchasing decision. This increasingly results in the home seller's utopia of multiple offers being received, often above asking price.
With extremely high buyer demand, an improving economy and the continuation of very of low cost mortgages, it is rather surprising that a shortfall in supply could occur at such a fortuitous time.
This naturally gives rise to the question why?
There is no single answer.
The recession years discouraged moving upscale and many homeowners decided to invest in improvements to their current homes. They simply postponed thoughts of a change and never revisited them.
Other contributory factors include capital gains tax changes that haven't encourage multiple house moves, plus the inescapable fact that many homeowners are happily locked into very low mortgage interest rates. The rise in home prices we've seen locally encourages some would-be sellers to delay listing in the hope that prices will continue on an upward path.
Those who are on the fence about selling your home should also bear in mind that with less competition between sellers at the moment their property can achieve an enhanced market and promotional profile and be consequently far more likely to attract viewings. They will also be able to negotiate from a position of great strength, not least because buyers often have few, or quite possibly no, other options that precisely fit their needs.
Those playing a waiting game on price should also consider that the current fantastic levels of buyer sentiment are simply not guaranteed to sustain.
There's only been good news so far in 2016 for those seeking a home loan, with interest rates falling to near record lows. This is almost entirely due to recent turmoil in stock markets. When markets recover, mortgage rate increases are virtually certain to rapidly rise, due to the excellent health of the US economy.
Expert predictions at the end of last year forecasted a quite significant interest rate rise this year. These statements did not take the recent stock market problems into account but still may be proven to be right in the long term, with over 10 months left in 2016. When rates steadily rise, there will be a reaction from buyers, themselves more likely to play a waiting game until they stabilize.
Our strong advice is that, overall, selling conditions have never been better. Call us today for an informal discussion of how to make the most of them.
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