Regional real estate agents are expecting a competitive spring following a particularly tough winter, according to a recent online survey of 780 Berkshire Hathaway HomeServices (BHHS) Fox & Roach, REALTORS agents. Seventy-four percent of agents surveyed said the spring market is already more competitive than last year, with low inventory cited as the number one reason competition is up this year (79 percent). Not surprisingly, 56 percent of agents report that homes are selling faster this spring, as anxious buyers enter the market again.
Competition in Chester County and Philadelphia County is particularly fierce, with 41 percent of agents in those regions reporting that the market in their region is “much more competitive” than last year.
This coincides with BHHS Fox & Roach’s April HomExpert data, which shows that Chester County has the lowest inventory of homes (3,758) in the Five-County Region. Homes in Chester County also sell the fastest in the 12-County Region, staying on the market just 71 days in April.
“After a tough Winter consumers are reentering the market and are ready to purchase their new home,” said Steve Storti, Chief Marketing Officer, BHHS Fox & Roach.
When it comes to balance of power, 40 percent of agents said that sellers and buyers have equal power. However, 34 percent of agents think sellers have more power compared to 26 percent that say buyers have more power. Whether you are buying or selling, agents say now is the time: 71 percent say now is a good time to sell, while 70 percent say now is a good time to buy. Sixty-five percent say real estate is still a good investment.
All this pent up excitement in the market stems from a particularly harsh winter. Agents across the region were negatively impacted, with 53 percent of agents saying the weather affected real estate activity in their region “a lot.” Overall, 56 percent of agents believe that their market is stronger than last year while only 17 percent felt it is weaker and 27 percent noted it was about the same.
Buyers and Sellers
With current market conditions giving buyers and sellers power, both parties feel they deserve control.
The biggest challenge buyers face is lower inventory of homes (77 percent), followed by multiple offers on a house (46 percent), rising prices (19 percent), fatigue (15 percent) and rising mortgage rates (7 percent). For sellers, 81 percent of agents say the biggest challenge is pricing their homes above market value.
Several BHHS Fox & Roach agents commented that sellers with unrealistic expectations are at a greater disadvantage. Their homes will stay on the market longer, while buyers want move-in ready homes and are willing to wait until they find one.
Thirty-four percent of today’s homebuyers are looking for larger homes, 33 percent are first-time homebuyers and 25 percent are looking to downsize. For the most part, agents find these consumers are looking to move due to a lifestyle change (new baby, divorce, job change) or because they’d like to live in a certain location or closer to family.
As the economy and the housing market continue to improve, home prices and mortgage rates are predicted to rise. Over the next 12 months, 68 percent of agents feel that the real estate prices in the region will increase slightly while 25 percent think prices will remain the same. The chances mortgage rates will increase during the same period is 42 percent while only .5 percent feel it will decrease.
The survey was conducted online mid-May to mid-June 2014 among all BHHS Fox & Roach agents across the company’s footprint, including Atlantic, Berks, Bucks, Burlington, Camden, Cape May, Chester, Delaware, Gloucester, Lehigh, Mercer, Montgomery, New Castle, Northampton, Philadelphia, Kent and Salem Counties.
To see the complete survey results, click here.