The housing market is considered a major economic indicator. If the housing market is doing well it reflects positively on the rest of the economy. As of now the inventory of houses in the California area are considered low compared to the statistics from a few years back. This report may have a double meaning attached.
On the positive perspective this means people are spending and buying homes. Which is simultaneously boosting the economy and the real estate market is prospering. The California Association of Realtors found that in a time frame of one year the average home went down from 16.6 months from being on the market to 3.8 months. Some homes even had multiple offers, turning the market into a competition. Those who are looking to purchase for an investment or for them are having trouble because there are so many offers that are exceeding the asking price. Even all cash offers are being beat.
On the other hand, this may also represent that many individuals who planned on selling their homes are waiting for a time when home prices rise in order for them to get the best value for their house. They are noticing the dramatic decrease in the prices of homes. The house that they might have bought for $500,000 may now be worth almost half the price. In this case they are keeping their homes off the market until they see an increase in prices.
Competition like this has not been part of the market for many years. This type of market is frustrating to potential home buyers. They have to wait long periods of time before they hear anything. This process has made their home buying experience almost impossible. Maybe a possible solution will be the addition of more houses on the market.
Contributor, designer & admin for JohnHart Gazette.
