Photo: Tim Sackton/Flickr
US homebuyers have faced intense competition due to rising national home prices and tight inventory, prompting many sellers to sell their homes “as is” with little to no fixing up done prior to the sale due to high demand. However, the market may soon shift in favor of buyers as early as 2018, according to new research by the online search portal Zillow.
Adding to homebuyer frustrations, less than half of homebuyers purchased the first home they made an offer on, says Zillow. Worse yet, because of the high demand for housing, many sellers in hot markets may receive multiple bids, and end up selling their home for above the asking price.
Yet, despite these unfavorable market conditions for buyers, most of the experts surveyed by Zillow agreed that the market would shift in their favor by 2019, possibly as early as 2018. Zillow forecasts that home values will slow to a 3 percent appreciation rate by October 2017.
“As the number of homes for sale increases and home value appreciation slows, we expect the market to meaningfully swing in favor of buyers within the next two to three years,” says Zillow chief economist Dr. Svenja Gudell.
Last month, the national median home value rose 6.2 percent from last year to $191,200 while inventory dropped nearly 6 percent nationwide.
Some metro areas experienced even bigger drops in inventory from last year. In Boston, inventory tightened by nearly 26 percent from October 2015 as the median home value rose 6 percent from the previous year to $405,200.
While not as dramatic a decrease as Boston’s, New York City inventory decreased by just under 10 percent year-over-year in October. Meanwhile, the median home value increased 6 percent to $398,000 from October 2015.
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