Bidding Wars Are Taking No Prisoners
Call it a perfect storm. But instead of cold fronts clashing with warm fronts, the real estate market is being rocked by ardent buyers competing with each other for the favors of choosy sellers. High demand from buyers, armed with low interest rates and excellent long-term economic prospects, face-off against each other for homes during a historic low in housing inventory. In fact, the National Association of Realtors reports the number of homes for sale is the lowest in 21 years.
The key indicators for the greater Charlotte region are eye-opening. As of July 31, 2020, the percent of original price received rose once again, this month by .9% from 97.2 last July, 2019 to 98.1 this July, 2020. The median sales price ballooned by $20,000, or 7.5% from $265,000 July, 2019 to $285,000 July, 2020. But the key statistic is the number of homes for sale, which dropped from 10,629 homes for sale in July 2019 to only 5,580 in July of 2020. That’s a drop of almost 50% – the biggest decrease in inventory we’ve ever seen. And it’s not just Charlotte; buyers’ agents across the country agree this is the most competitive market they’ve ever seen. Little wonder that the number of days on the market until sale fell by 5.35% from 38 days on market to 36 days on market before going under contract.
So listed homes are quickly being snatched up by eager buyers. And the result is a bidding war.
Even COVID can’t cool off this overheated market. While the number of unemployment claims have diminished in the last few weeks, 31 million workers are claiming benefits. Still, buyer demand remains strong, and the latest forecasts predict high buyer activity will continue into the early fall market.
Smart buyers use every advantage in such a challenging market, including recruiting an exclusive buyer’s agent who represents their interests only, who knows how to negotiate and structure a winning offer.