Buying and Selling When There Aren’t Enough Houses or the Right Houses
Posted November 15, 2021 in Real Estate Trends
If you’ve been in the market for a home to buy, you may be among the many buyers who find that there aren’t enough houses to choose from or the right house is very, very difficult to find. There are 64 million existing houses that were built prior to 1990 that are in need of updates or repairs according to CoreLogic, an institutional investment data firm. Chances are that you’ve viewed a few of these, if you are seeking to buy a home for your family.
These homes represent the many homes that are difficult to choose, because of the improvements that would be needed in order to make these homes a viable choice for many buyers. However, there is a new competitor edging for some of these homes, because of these homes needing repairs. These are the home flippers. The complexity of competing against home-flippers may be getting a bit easier.
Zillow recently announced that its home-flipping business is reducing its workforce by about 25% this year and also pausing offers on homes without signed contracts. There are others in the business of financing flips that are acquiring other lenders and growing different variations of competition for the single-family home shopper. Many of the flip loans are being awarded to those that have completed at least 40 homes according to industry data. The reasoning according to these lenders is that the loans are typically short-term or about a year in length and high-interest. This gives some single-family home shoppers an in when trying to compete.
Nationally, about 80,000 home sales in this year’s second quarter were homes needing repairs, because they are defined as flips within the marketplace. Flips are defined as homes that get sold in a year or less after a purchase. Some of the homes owned by flippers are being held as single family-rentals which are changing the home buying dynamic once again. Even some new home builders are focusing on building homes for rent due to the rising rent opportunities and opportunities for private investing. They are banking that many homebuyers are going to continue to give up in finding the right home.
Many who are in the business of home-flipping are finding the same difficulty as those who are trying to find a home to live as a single family. The bottom line is that there simply are not enough homes; however, mortgage lenders like Finance of America has not changed its commitment to finding more options to help folks find their perfect home. I find that it’s a matter of buyers working with a lender to gain the best strategy in today’s marketplace.
Because there is a community commitment to homeownership within the Vancouver marketplace, those persons who still want to find their perfect home have many more options than there were a year ago. These are different options than simply finding a home and moving into that home.
You should know the resources that are available within your community. This starts by having a mortgage advisor who has your best interest as this is the best place to coordinate with your real estate professional. It is now the best strategy to work as a team. This means that your real estate professional, your mortgage advisor and you are all working together.
Be sure to find a licensed advisor that you know serves your best interests, your community, and has history in the community as well as will be there for you for the duration. Call 360-607-9312 or email MPattullo@FinanceOfAmerica.com for help preparing your credit application to best evaluate your mortgage options. We are your local advisor.
We lend where we live,