Whats the local Market doing?

The August sales numbers for the Wichita metro area have been released and they show a slight increase of 2.7% in sales from July to August. This is good news however the numbers for July were down about 33% from the spring rush. This spring the buyer tax credit was in effect until April 30th so that helped inflate the numbers for sales during that time. The drop off was dramatic and it could take a few months to really be able to gauge where the market will settle down and reflect a true market condition. New home sales did not fair as well as resale homes and new home sales actually drooped 2.4% in August. Inventory for resale homes was up 25% over this time last year and inventory for new homes is 18% lower this year then last year.

What does all this mean? In a nut shell it means now is a GREAT time to buy a home and a not so great time to sell a home. It means that the market is a strong Buyers market and there is lots of inventory to pick from. There is about an 8 month supply of homes (resale) on the market and about a 12 month supply of new homes on the market. A 4 -5 month supply is considered a balanced market so you can see that buyers are in a great position right now.

Does that mean that as a buyer you can low ball any home and get a steal of a deal? NO, NO, NO. That would assume that all sellers are in a situation that they must sell or loose their home or that all sellers are desperate. There are a few situations where that might be true but for the most part many sellers are not in a position where they must sell or else. They are looking for a fair price and many will offer incentives that will enhance the sell for their buyer. As a buyer look for concessions such as seller paid closing costs for the buyer, flexible closing dates, or maybe some personal property might be included ( a pool table might be left or a hot tub, etc) As they say Every Thing is negotiable in real estate.

Tough Market

In case you haven't noticed the real estate market in Sedgwick County is SLOW, SLOW, SLOW! No use trying to deny it, there are lots of homes on the market and few buyers ready to deal. It appears to me that if you are a buyer you have a real opportunity to find a great home at a good price. Interest rates are at their lowest levels in many years and while lending rules have tightened up there is money available for responsible buyers. My friend Lisa is a lender and she says that if your credit score is at least 620 and you have a down payment you can buy a home. The money is there waiting for you.

I've talked to a lot of realtor friends recently and the buzz is all the same. Where are the buyers? Some think that everyone who wanted to buy probably did so before the tax credit expired in April. I find that hard to believe as couples are still getting married, babies are still being born (families are growing) and kids are still going away to college and leaving parents at home with to much house for just the 2 of them. Some agents think that the unemployment rate is to blame. Yes, we have about an 8% unemployment rate in the area but that still leaves 92% of folks employed. I think the main culprit is FEAR. Fear of job loss, fear of not being able to get a loan, fear of making a commitment in a time of uncertainty. The truth of the matter is that real estate is still a great investment, much more stable than the stock market, you could lose your job tomorrow but you could also get a promotion tomorrow and climb that corporate ladder, and if you've been diligent in your finances you can get a loan. It is often said "The only thing to fear is fear itself". Lets hope that rational thinking wins out and fear does not continue to rule in our community.

Remember, all real estate is local and what we are hearing on the nightly news out of California, Florida and New York is not necessarily what is happening here in Wichita.