When it comes to playing the real estate game, your playbook will vary depending on where you live. Some markets are cooling off from their recent resurgence, but other markets--particularly metropolitan areas on the coasts--are staying hot with demand.
A new survey of Coldwell Banker real estate agents shows buyers looking to purchase a home in Seattle, Memphis or areas in between have a good chance of having to contend with tight inventory and bidding wars.
Here’s a look at look at what Coldwell agents are seeing in four markets around the country, and what they mean for buyers and sellers:
Average home price: $544,355 (last 30 days)
Average days on the market: 32
Market Climate: This year is going to look a lot like 2013 when bidding wars and making multiple offers were the norm for buyers in the Seattle area. However, this year the buying frenzy started in January instead of March, says Franz Diessner of Coldwell Banker Bain.
“We anticipate continued strong demand through the end of summer and when the kids go back to school in September, we often see a lull and then it picks up again in October; 2014 may be a record setting year in our personal business.”
What buyers want: Even if multiple offers are still the name of the game, sellers have to have well maintained homes with updated finishes and good curb appeal to lure those buyers in, says Diessner, noting buyers are being picky in Seattle.
Buyer Tip: Buyers need to be ready to move fast with their offers, or they risk losing the property, warns Diessner. Buyers also have to be prepared to write several offers in this market before they can call themselves a homeowner.
2Greater Philadelphia Region (Bucks County, PA)
Average home price: $500,000
Average days on market: around 60 days
Market Climate: Inventory shortages is still a problem in Bucks County, particularly in the Yardley, Newtown areas, says Coldwell agent Martin Millner. Although bidding wars aren’t happening with every listing, they are still relatively common. Even though the market is hot, Millner says it’s still possible to overprice a property and have it sit since buyers are reluctant to overpay.
What buyers want: Even with low inventory levels, the condition of a home still matters, says Millner. The homes that move the fastest are the ones that are in the best condition based on the price range. “Buyers are willing to sacrifice size for quality and condition. This is true at all price ranges in our market.”
Buyer tip: Be willing to compete for homes in the greater Philadelphia region, but don’t go too much over asking price.
“Throughout all of Bucks County, we saw about a 3.5% appreciation last year, and we have seen further appreciation of another 1% or so through the first quarter, this year, so we are not seeing wildly appreciating prices,” says Millner.
Average home price: $151,000
Average days on market: 91 days
Market climate: With inventory down 10% from last year, homes are selling at a fast clip in this southern city.
According to Coldwell agent Sally Isom, homes that are in good condition and are reasonably priced get multiple offers, or at the very least a contract, within days of going on the market.
“If [homes] are in a really desirable school district or have a great pool or other lifestyle amenities, they will get multiple offers,” she says. Low interest rates and an increase in home prices are partly driving the demand in Memphis, but Isom adds that a major school redistricting is creating additional relocations within the area.
What buyers want: Buyers want move-in-ready homes with at least three bedrooms with a bonus room, or four bedrooms minimum, Isom says.
Buyer tip: With inventory down 10% from a year ago and the average home price up 5% in the same time period, buyers have to be willing to make an offer quickly.
Average home price (La Jolla): $2.2 million
Average days on the market: 74 days
Market climate: Bidding wars are still breaking out in San Diego county, although the pace isn’t as frenzied as last year, says Coldwell agent Michelle Serafini. She says lack of the inventory is behind the bidding wars.
What buyers want: Buyers in the San Diego region are looking for either move-in-ready homes or fixer uppers. If either type of property is priced at or below market they are getting multiple bids, she says.
“People are not looking for gated communities, home owner association properties or condos as much as they are looking for detached, single family residences with potential or are move in ready for enjoyment.”
Buyer tip: Cash is king in this hot market. Buyers who need a loan to make a purchase are going to have a tough time competing with all-cash buyers.
“International buyers are strong in the coastal markets of San Diego. They want views, potential and location,” Serafini says. “Investors are still in the market, looking for opportunity homes they can fix, improve and make a profit on.”