Real Estate News: What is going on in our low inventory of low-priced market?
I understand it has been increasingly difficult to find affordable homes to buy. It is especially frustrating for first-time homebuyers who are ready to make one of the biggest decisions in their lives but are faced with little to no options of low-priced homes.
Comparing 2016 first quarter with the first quarter in 2015, entry level homes have soared by 20.3 percent. Prices are going up at the lower-end because of the shortage of homes below $400,000.
There is only a 3.3 week supply of unsold single-family homes priced between $100,00 and $199,999; a 1.6-week supply of single-family homes priced between $200,000 to $299,999 and a two-week supply of unsold homes between $300,000 to $399,999.
The affordable condo market is even tighter. At the end of March, there were only seven condos on the market priced below $99,999 and they were sold in a week or less. Overall, there is about a 3.5-week supply of condos on the market.
Despite the grim news, there’s always an upside to everything. Prices may be going up but they are incomparable to California. For example, the median price of a home in San Jose is $956,500 and the median price in Castle Rock is $425,710.
The shortage of lower-priced homes has created opportunities for homebuilders to modify existing models and making them much more affordable. We’re also hopeful that the State Legislature can reform construction defect laws, allowing builders to bring more affordable condos to the market.
For every good, there’s a downside and for every downside there’s something good so don’t be discourage by the market.
I’m not going to sugar-coat the truth and it is going to be tough for home buyers especially for first-time buyers or people looking to upsize. However, when there’s a will there’s always a way.
A few things to consider if you want to stand out in the competitive market
• Get pre-approved for a loan
• Finding an agent who has experience with bidding wars
• Move fast and be patient
• Consider agreeing to the asking price
Any questions and want to learn more on how to stand out, contact me and I would be happy to help.