What is causing this seller's market? | Monday Minute January 25, 2021

What is causing this seller's market? | Monday Minute January 25, 2021

Right now in the real estate market we are experiencing quite the extreme sellers market.  Due to the super low inventory, sellers are able to demand a premium price for their home.  The question I get asked the most is what is causing this?Well, the main reason is from the overwhelming buyer demand. This is due to record low interest rates. The current inventory levels on the market are unable to meet that demand.  A normal, healthy, real estate market is around 6 months of inventory.  Meaning that if we were to sell every home currently on the market, it would take 6 months.  Right now, on a national level as of December 2020, we were at 1.9 months on inventory, with our local area being even less than that.  So, why doesn’t every seller just put their home on the market and take advantage of this time?  While that would be the answer to start solving this issue, there are reasons that are stopping that from occurring.Zillow did a study finding 3 main reasons for why homeowners are hesitant to list their house even in this strong seller market.#1: 31% of people stated Financial uncertainty.#2: 34% of people stated that Life is too uncertain right now.#3: 25% of people stated that it was due to Covid-19 Health Concerns.However one of the top reasons that we have found in the market right now is that current home sellers are concerned that while they may be able to sell their home in record time for top dollar, they weren’t confident that they would be able to find anything on the market to purchase.  Zillow also did a study showing that 63% of home sellers are also buyers.  This situation creates a real catch-22, especially if you are buying in a similarly low inventory price range or market.If you are in a position where you need to sell - maybe you are relocating, moving into the area, need to downsize, etc. there ARE some solutions available and my team and I are qualified and happy to walk you through this process.