If you’ve been house hunting in 2017 then you are well aware of the housing inventory shortage Northern Virginia is facing. The low supply has continued to push prices up and create scenarios of multiple offers throughout NOVA.
So why is inventory so low?
1 Low Inventory – Wait, what? Sellers know there is currently a low supply of listed homes and are hesitant to join the pool of buyers searching for a new home.
2 Mortgage Rates – Many current homeowners have the luxury of historically low interest rates. So the question becomes why give up a rate of 3.5% for an increase to 4.5%.
3 New Construction – While starts are at the highest level since 2006, they still aren’t at expected levels. Rising land costs, an increase in regulation and zoning costs, a shortage of skilled laborers, and growing material costs have kept builders focusing on multi-family and high-end construction.
4 Underwater – 1 in 5 homeowners still don’t have enough equity to sell their home.
5 Remodeling Trends – Many homeowners are taking a different approach and opting to renovate their current house rather than sell and purchase a new one.
So how do buyers compete in areas with tight inventory?
Financing – Have your prequalification in place and ready before you start looking.
Availability - Be available at a moments notice to view homes that come online.
Confidence - Ensure you are positive about the type of home you want and the location.
Flexibility – When placing offers on a home, be flexible with your contingencies.
Rent Back – Consider offering the sellers a rent back option so they can feel comfortable searching in the same market.
Inspectors – Bring a home inspector in before you make an offer. Knowing the house has a clean bill of health can alleviate a Home Inspection Contingency and make your offer more attractive.
Agent – Hire an agent who is well connected and thinks outside the box. An agent with keen negotiating skills, willing to door knock, call expired listings, or has a large database full of potential sellers is the right agent to guide you through this environment.
Have you purchased a home in this low inventory climate? If so, share your stories and tips.