With mortgage interest rates from some lenders dipping below 2.2 percent, Fort Wayne area real estate professionals are saying now is a great time to buy a house.
That is, if you can find one.
Over the last 12 months, the number of houses on the local market has dipped precipitously, according to statistics gathered by Upstate Alliance of Realtors, also known as UPSTAR.
And some real estate pros are, albeit cautiously, starting to say two words they haven’t uttered in years – sellers’ market.
Consider the numbers from March compared with the same time last year. The number of properties for sale? That shrank by 16 percent, to 2,905. New listings? They’re down, too – by 14 percent, to 1,001. The number of months’ supply of inventory? That also dipped by nearly 25 percent to five months.
A six-month supply of housing inventory generally is considered a balanced market, one with about as many buyers as sellers. That’s something that hasn’t happened for a long stretch as foreclosures and other economic woes had many more properties on the block than there were buyers, who could afford to be picky. With less than six months’ inventory, sellers gain the upper hand.
Locally, housing inventory has dropped or stayed virtually unchanged for nine straight months as pending and closed sales inched upward, according to Kim Ruffin, UPSTAR spokeswoman.
We’ve dipped below 3,000 units (on the market), and that’s the lowest housing inventory we’ve had in almost a decade, she says.
The upshot? Some Realtors, have been able to bring sellers a plethora of potential buyers. In some cases, sellers are getting multiple offers.
Last month, Matt and Tonia Huffman listed their two-story, three-bedroom home, sandwiched between farm fields in the tiny village of Tocsin outside Ossian, with Jody Holloway, owner and principal broker for Coldwell Banker Holloway in Bluffton.
In just nine days, the remodeled house dating to the early 1900s had 14 showings, Holloway says. It’s priced at $80,000 and has two, two-car garages and a deck, above-ground pool, outdoor hot tub and shed, as well as a bonus room that could be a fourth bedroom.
Matt, 45, a maintenance engineer, apologizes for the state of the garage as he greets a visitor.
We thought we’d put it on the market and then clean it up, he says. Well, we haven’t had a chance to do anything. With all the showings, we haven’t had the chance to sit down.
Adds Tonia, 49, business office manager for a Fort Wayne senior community: We are so pleasantly surprised. We weren’t expecting this.
Holloway says houses in good condition and priced right have been a quick sell in recent weeks, with homes in the $140,000 to $180,000 in demand.
The inventory is just not here like it had been in years past, he says.
But Adam J. Smith, UPSTAR president and a broker with Coldwell Banker Roth Wehrly Graber in Fort Wayne, says the sellers’ market isn’t across the board.
It’s crazy because it’s not every price point and every location, he says – something borne out by UPSTAR’s March numbers.
The low end of supply is in Whitley and Allen counties, at 4.1 and 4.4 months, respectively. Dekalb County’s inventory stands at 5.4, Huntington’s at 6.2 and Adams’ at 6.5. Only Noble County, at 8.0, and Wells County, at 7.8, are still solidly in buyers’ market territory.
Todd Stock, a ReMax Results Realtor in Fort Wayne, says one reason inventory remains depressed is not as many new homes have been built in recent years because of construction market difficulties, leaving existing homes to satisfy that demand.
Another is that potential sellers still see themselves as owing more on their home than it would bring from a sale, he says. The situation commonly is called being upside down or underwater.
But national statistics recently shared with local ReMax agents show the number of homeowners who were underwater but no longer are has doubled in the last year, Stock says – partly because of a surge in refinancing and, in some cases, rising prices that have put homeowners in a better equity position.
We anticipate that number will double again this year, he says, and the numbers are staggering.
Locally, real estate professionals say, home prices, typically a lagging indicator of a market shift, have not risen. The median price of a house – the midpoint of all homes sold – last month stayed steady at around $100,000.
That’s a bright spot for current buyers, they say.
Smith says he wonders if at least part of the lagging inventory is the result of weather – last year’s typical spring house-selling season had warm weather early, while this year’s has been laced with late snow and cold temperatures that may have discouraged people from thinking about moving.
And Holloway notes that he’s had at least one buyer who’s waiting to list his home until he finds one.
But Holloway, Stock and Smith agree that the market is improving for sellers.
We’ve not seen prices move (up) yet, but conditions are improving and there are more buyers out there. It’s as good a time to list a home as we’ve seen in several years, Smith says.
So, those with a home to sell should expect postcards and emails and phone calls as agents and brokers try to scare up listings.
I know we are really pushing it hard at the board level and at the office level to try to get homes listed, Smith says. I definitely am hitting up my database.