Inventory: How it Affects the Real Estate Industry
Filed under: Real Estate Market
As inventory ebbs and flows over the years, it has an undeniable impact on the real estate market. It’s a basic principle of supply and demand: when there aren’t many homes available, then buyers are willing to pay more to get the properties that are available.
Even before the COVID-19 pandemic, we were experiencing low inventory in the real estate market. The industry stayed strong through the ups and downs of the pandemic, and inventory has remained low because there has been such a demand.
What Low Inventory Means
When there is low inventory in the real estate market, it means that there aren’t enough homes available to meet the needs of the current homebuyers. The limited number of homeowners looking to make a change, combined with the fast transactions when homes are available, affect both buyers and sellers.
The prices will continue to rise on homes, until eventually the market starts to balance out. A variety of factors can affect inventory levels, such as interest rates (low rates motivate more people to buy homes), economic factors, and more.
How Inventory Affects Buyers and Sellers
There’s no question that inventory affects both buyers and sellers:
- Buyers: With many interested buyers in the real estate market, you have to be competitive about the timing and amount of your offer. Most properties are moving quickly – as soon as the listing goes live. Also, many of these homes are selling above asking price. Our experienced real estate team can help you navigate the industry to increase the likelihood of your offer being accepted.
- Sellers: On the other side of the coin, sellers can expect multiple offers within the first day or two of listing the property. One of the benefits of selling in a low inventory time is that you can maximize your equity since the offers are coming in high right now.
Timing: When to Buy or Sell
Rest assured knowing that you can buy or sell a home during this pandemic. We are proactive about maintaining recommended health and safety measures to keep everyone safe through this process.
The timing of your real estate purchase varies depending on the needs of your family. If you’ve been thinking about selling, then it’s a great time to jump in so you can enjoy the benefits of high equity for your property. For more info about buying or selling in the current market conditions, call, text, or email me at (951) 473-0390 or [email protected].