GREENSBORO, N.C. — Buying a home in this housing market is wild!
"It's like Wal-Mart on Black Friday and TVs are on sale and we're all waiting at the door to get in. That is the housing market right now," said Ashauna Harris, the Broker-in-Charge and owner of Empire Realty Group.
Harris provides quite the description but it is so on target. Harris says the reason the housing market is so hot right now cannot be blamed on one thing.
The coronavirus pandemic, supply and demand, historic low-interest rates, and the 26% spike in prices for building materials all factor into the hot market.
There is no question the summer of 2021 belongs to the sellers. The situation, however, is getting dire for buyers.
"In June 2020, the average house remained on the market for about 12 days. In June 2021 that was down to four days," said Harris. "Imagine if you're a buyer and you have 20 to 30 buyers looking at one home and it only remains on the market for four days," said Harris. "You're getting frustrated and most likely getting outbid," said Harris.
Harris says the low housing inventory is causing bidding wars and even buyers with A+ credit and money down are getting priced out. Offers are coming in way above asking and sometimes in all cash.
"The national average number of offers on a home is four but a move-in ready home in a very desirable neighborhood could get several offers well-above that. Sometimes, 10, 20, or even more offers and buyers are now offering $10,000 to sometimes $40,000 above the asking price. On top of that they're waiving contingencies," said Harris.
While buyers waving inspections, appraisals, and other contingencies is the new trend, Harris says it's risky.
"I really discourage my clients from waiving inspection and appraisal contingencies. If you are willing to bring in the appraisal gap contingency that's fine but you have to get an appraisal in order to have a mortgage. And in order to have a mortgage, you need to have an inspection. Also, you should go into a home purchase with your eyes wide open. Buying a house without an inspection is a risk you don't want to take."
In the second part of this housing market series, Harris looks into when the housing market might start to cool and whether you should jump in now or wait it out.
Watch Friday, July 16th from 6 to 7 a.m. on the Good Morning Show.