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Summary: Summer has advantages for house-hunters that Spring does not. Even with low inventories of available houses, smart buyers exploit the season to find good deals.
Although spring is often the high point in shopping for houses, the contraction of available inventory during the COVID-19 shut-downs leaves many home buyers still waiting for an expansion of real estate listings. As the economies of various states begin to open again for business, many shoppers will re-boot their efforts to find the right home at the right price. Although questions remain about how many new listings will appear, they will in no way damper the need for houses in Washington, Oregon, Idaho, and Colorado.
What Makes Summer a Good Time to House-Hunt?
Unsold Spring Listings Await
True, the coronavirus complicates the usual selling/buying patterns that flow with the seasons. Still, many analyses demonstrate that the pandemic did not stifle the demand side of the equation during March, April, and May. Neither was the real estate business lacking customers during the spring. The fact that numbers were modest in terms of homes for sale may have bestowed a negotiation advantage to sellers, but it did not keep inventory from moving. In addition, inventory often expands during the summer months, shifting the bargaining edge at least slightly in the buyers’ direction. Furthermore, the houses that did not sell over the spring may list for lower prices in the summer.
Popular vacation destinations are re-opening all over the United States. This phenomenon can filter out the less-motivated buyers from the truly committed. Taking a holiday is just more convenient during the summer months. Schools are closed, and summer vacations are often scheduled with employers far in advance. For those who absolutely must procure a new house, vacations can wait. For the interested but less urgent, time away takes the highest priority. This fact can significantly whittle down the buyer competition in local markets, leaving discounted properties for people willing to sacrifice summer rituals to a higher cause, namely getting into a new home.
Following the School Year Rhythm
Moving is always stressful, but ever more so when parents must transfer their children to new schools in the middle of an academic year. Often in such cases, quarterly grades are not yet finalized so incomplete records are passed to the new school, which must evaluate the student without all the most recent facts. Moving during the summer avoids such scholastic and bureaucratic challenges. Moreover, kids do not have to assimilate into a new classroom where social relationships are already forged, making friendships more difficult to establish. While work requirements might demand immediate relocation, waiting for schools to let out before moving is a gift to the next generation.
Spring Shopper Exhaustion
Many spring house-hunters achieve little success during that peak buying season, feeling exhausted after a few months. Given the smaller for-sale pool in Idaho, Washington, Colorado, and Oregon, this burn-out may be widespread. There are several reasons for this. One may be that the tempo of the search may be too intense at the outset, sapping their best energies. Additionally, motivation diminishes when the quest bears little fruit. At the same time, couples may have conflicting desires as to what the new residence should be. Taken together or separately, these realities can induce search-fatigue, causing tired shoppers to take a little break.
What Does the Inventory Look Like?
The Evergreen State has seen low housing inventory since at least the fall of 2019. This means that the current state of listings may or may not relate to COVID-19. Real estate analysts observe a shrinking of the listing pool every year as autumn turns to winter. Yet new listings ordinarily remain consistent. In 2019, however, they were reduced. Market direction is more difficult to ascertain with so many variables affecting it, though first-time home buyers may find a rare opportunity to get a bargain. If the statewide and national economies substantially rebound, interest rates might do likewise, filtering out potential buyers. Sellers who fear this may list their houses sooner rather than later.
According to numbers put out by the Regional Multiple Listing Service (RMLS), both sellers and buyers in Oregon dropped off markedly, especially in metro Portland, as soon as the pandemic began necessitating restrictions and stay-at-home orders. Since then, home prices have risen slowly. Meanwhile, toward the center of the state in Bend, robust sales have been tempered by low inventory. This occurrence may be the result of average prices dropping by five percent. At the same time, pending sales are higher than at this time last year. Nevertheless, few expect a significant uptick in listings during the summer months. Stay tuned.
Prior to the lockdowns of late winter and spring, housing inventory was actually up in the Boise/Ada County area, according to the statewide realtor organization. However, pending sales have dropped, i.e. there are fewer homes under contract. Forecasts for the summer, vary but migration is working in Idaho’s favor. As one of the fastest growing states in the U.S., Idaho may very well benefit from the coronavirus legacy, more people working remotely and choosing the Gem State for its quality of life and natural beauty. If this trend plays out over the next few months, and available housing does not tank, summer may see a vibrant real estate market.
Like its neighbors in the western part of the U.S., Colorado is not awash in available homes for sale. In fact, the dearth of listings is at record lows per the Colorado Association of Realtors. Nevertheless, pending sales for May of 2020 reached unprecedented heights, both in metro-Denver and statewide. With the lifting of prohibitions on in-person showings, more buyers are returning to their search for new houses. As with other states, the question mark remains over whether inventory will rebound to accommodate this influx of purchasers.
How Do Buyers Prepare for the Summer Market
How, then, can those searching for homes get ready for summer shopping when the prospective inventories are so modest? Savvy buyers are undaunted by such challenges. They see, instead, the opportunities summer offers.
Getting Better with Age
Spring listings that get no bites in season are potentially excellent prospects for summer buyers. Once on the market for two months or more, these houses produce more flexibility on the part of their owners. In fact, motivation turns to urgency for many sellers, leaving purchasers in a stronger position.
Envisioning a Dream Home
There are houses that remain on the market because they frankly need work. Competitive buyers are not so quick to dismiss them. Many of these less-than-attractive dwellings have sound foundations and structural integrity. Sometimes, decent landscaping and a fresh coat of paint make all the difference. Some houses just look like shacks because of inattention.
If they have the time, buyers will wait until the back-end of the season to put their search into high gear. By mid-July into August, the intense home-seeking ebbs as people grab vacations and get ready for a new school year. When inventory is low, this is a better time to strike.
Real Time with the Realtor
When fewer houses are listed, real estate agents have more time for purchasing clients. Successful summer house-hunters employ their agents as consultants and advisors regarding strategies and the market. Yes, sellers pay the commissions, but buyers make the closings happen.
Arrange for a Mortgage Early
One constant about summer is that it ends quickly. Before labor Day rolls around, speak to a mortgage consultant and get pre-approved. Sellers will know a serious offer when financing is addressed.
Since 1992, Sammamish Mortgage has been helping home buyers in the Pacific Northwest achieve their dreams. If you’re searching for mortgage financing, we can help. We offer mortgage programs in Washington, Oregon, Idaho, and Colorado. You can contact us with any questions if you need them answered. If you’re ready, you can directly View Rates on our website, or if you are ready, you can Apply Instantly or get a Rate Quote.