The first existing home sales report is out for 2013 - confirming a strong sellers market is developing with gains again in both home prices and home sales. January home sales are up 9.1% and prices are up 12.3% from January 2012. This market is hot and getting hotter. If you are not in, you need to be! (Learn How with Me Tomorrow Here.)
This is the 11th consecutive month of year-over-year price gains, which last occurred from July 2005 to May 2006, and is the strongest increase since November 2005 when it jumped 12.9 percent. Sales volume was the highest since 2007 and the strongest increase since 2004.
With available housing inventory dropping 4.9% – we are now at a 4.2 month supply – the lowest housing supply since April 2005 when it was 4.2 months.
Listed inventory is 25.3% below a year ago when there was a 6.2-month supply. Raw unsold inventory is at the lowest level since December 1999 when there were 1.71 million homes on the market. Plus, buyer traffic is 40% above a year ago, so there is plenty of demand but insufficient inventory to improve sales more strongly. We have very much transitioned into a seller’s market in most of the country.
“We expect a seasonal rise of inventory this spring, but it may be insufficient to avoid more frequent incidences of multiple bidding and faster-than-normal price growth” said Lawrence Yun, NAR Chief Economist in this recent report.
Combine the strength in home sales and prices with my recent findings in “Foreclosure Listings Dropping Like a Rock ” it is clear that this housing market is hot and getting hotter.
We now have a new problem – a serious shortage of available homes to purchase. Shocking news when you look at my blogs from last year. The turn around I projected last May is absolutely coming true. In fact it is happening much faster than any of us imagined.
As I’ve said all along, once inventory drops and prices start to rise, we will have to apply new strategies for finding deals. You can no longer scour the MLS (multiple listing service) for deals. You can no longer make low ball offers to banks on their REOs. You can no longer go to the auctions and grab a “drop bid”. Every Tom, Dick and Harry (and many large investment funds) are throwing money at those deals. You need to go where they are not.
That means you need to work the “off the market” shadow foreclosure inventory – pre-foreclosures with equity and pre-foreclosures without equity (short sales) – dealing directly with the motivated homeowner.
This is exactly what I am doing right now, along with my current successful investor clients. Find out the details tomorrow in my Live Webinar “How to Buy Foreclosures, Make Fast Profits Now” at 6pm PDT (9pm EST). Join me to learn the steps you need to take to grab some wholesale deals right now – in your own backyard – before spring hits and it really gets crazy!
What are you experiencing in your market? Please share with us by commenting below. Thanks!