Since the great recession and the real estate market crash, home sellers have had to compete with distressed properties i.e. foreclosures and short sales. But now there’s a new kind of competition – new home construction. According to the latest RealtyTrac distressed home report, foreclosure sales dropped to a 15-year low because the market is normalizing. However, with a normalized market comes competition from newly constructed homes.
According to the National Association of Realtors’ Profile of Home Buyers & Sellers new home sales accounted for 16% of all homes sold in 2014. This graph lays out the 5 reasons buyers choose new construction over a pre-owned home such as yours:
The top three should not come by surprise. With a new home comes the ability to customize the design of the home and the ability to avoid having to renovate or deal with existing problems. The 10% of respondents who cited “Lack of Inventory of Existing Homes” could very well increase throughout 2015.
Existing home inventory in SoCal is currently at 2.5 months (Orange, Los Angeles, Riverside and San Bernardino Counties), well below the six-months needed to be at a historically normal market. National Association of Home Builders (NAHB) reports that there is currently a 5.4 months supply inventory of new construction available for purchase.
How Can You Compete?
Get your house on the market now! There’s a steady buyer demand on the market at this time but a lack of existing inventory. If you’re ready to put your house up for sale now, you will avoid additional competition coming onto the market.
Team up with a First Team agent if you’re ready and get started on your home sale strategy. You can find an agent near you by searching on FirstTeam.com or just give us a call and we’ll find the perfect agent for you.
Email us at clientservices@firstteam.com
Call us at 888-870-1142
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