Many owners would love to get top dollar for their home, but they weigh that perk against the downside – buying another home – and fears outweigh their desire to list.
NEW YORK – Some homeowners are reluctant to sell amid a hot housing market because the profit they stand to make is less of a concern than the burden of finding a new home.
Selling appears easy right now – list, accept multiple bids, and sell for top dollar. But the prospect of fierce and expensive bidding wars to secure their next home is discouraging.
Thad Wong, co-founder of @properties, says that “even with low rates and the appreciation of their home, they can’t find something better than what they live in right now.”
With so many homeowners unwilling to sell, housing inventory is extremely tight; the number of existing homes on the market at the end of April was down 20.5% year over year, while the number of listed homes plunged to record lows earlier this year. The low stock underpins continuing home price appreciation, making homeownership too costly for many buyers.
The timing of dual transactions – selling one home and buying another at the same time – contributes to the problem since many families can’t afford to buy a new property without selling a current one first. And since sellers often receive multiple bids in the current market, agents say offers with contingency clauses are likely to be rejected.
The supply shortage is particularly pronounced at lower price points. The National Association of Realtors said the supply of existing homes on the market priced between $100,000 and $250,000 fell more than 30% in April from a year earlier, while the stockpile of homes listed for over $500,000 grew.
“I don’t think we can really alleviate the shortage until people feel like they can sell their home and move,” says Meredith Hansen with Keller Williams Greater Seattle.
Source: Wall Street Journal (06/04/21) Friedman, Nicole
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