It really could not be predicted. For years during
and after the financial crisis analysts warned that the real estate market would
be weighed down by an avalanche of bank-owned properties and short-sales. And
these analysts were right, at least for awhile. But quicker than most everyone
expected we turned from a buyers' market to a sellers' market in many areas of
the country. How can it be that buyers can't find homes for sale when there are
still so many foreclosures to deal with?
One reason is that investors have bought every
bargain in sight. Those with the money recognize good buys and investor money
poured into the real estate sector. Another reason is that home building slowed
down to a snail's pace during the recession and we were not building enough
properties to keep up with our muted household growth, let alone older homes
which had to be replaced. Finally, the most recent long, cold winter put a lid
on new listings. This effect we have hypothesized to be temporary and already we
are seeing numbers that support this hypothesis.
But there is another reason and this reason is
psychological. Most who list their home are "moving up" to a bigger and better
home or if they are closer to retirement, they are trading down. However, if
they don't believe they can find the home they want, they will obviously be
reticent to list. So the dearth of listings is actually causing some not to
list. Is this temporary? We believe so. As more homes become available, more
will list their homes. We are not looking for a flood, but more of a balanced
market. Meanwhile, if you are thinking about selling--this may very well be an
opportune time.
Mike Ervin
Branch Manager/Mortgage Loan Officer
NMLS: 282715
W.J. Bradley Mortgage Capital, LLC
O: 650.735.5261
C: 650.766.8500
