This time last year, a usual sign of spring was mostly missing: the “Open House” sign. But with the pandemic loosening its grip on much of the country, and vaccinations making sellers more willing to open their homes to strangers, the spring homebuying season is in full swing.
That means bidding wars and high house prices, as too many would-be buyers chase too few homes for sale. But, a little relief may be coming.
Wes Chernin and Eliza Kinrose started shopping for a house in Portland, Oregon, last September. By the time their lease expired in November, they still hadn’t found one.
“We’ve been doing month to month Airbnbs for the past like six months, I think,” Chernin said.
A couple weeks ago, after more than 60 home tours and seven failed bids, they finally got a house. “It’s sort of a small, but very cute, little quintessential Portland bungalow,” Kinrose said. “We shed some tears when we found out we got it.”
The price was $435,000. They went in over-asking and it worked: no bidding war. Their broker Brad Twiss thinks the market might be loosening up, at least in Portland.
“We’re seeing more listings, and not only that, we’re seeing buyers get a little more power back,” Twiss said.
In the past month, he’s had offers accepted that weren’t the highest but had better terms. “And, like Wes and Eliza, we got a closing cost credit for some repairs. I don’t know the last time we did that. It does feel promising.”
There’s some data to back him up. Zillow recently reported that overall inventory, nationally, was down just over 1% in March, compared to drops of around 8% in January and February. Economist Matt Speakman said new listings were up 30%.
“That does indicate that sellers are growing more confident, there is sort of an increasing propensity to list your home,” Speakman said.
And in the coming months, people find out what their post-pandemic work lives are going to look like. Daryl Fairweather, chief economist at Redfin, said more of them may be willing to move.
“That’s going to give people more confidence to buy a home because they’re just going to know what that home should be like for their future,” Fairweather said.
But unless a whole lot more homes come onto the market, “whatever comes up for sale will get snapped up,” said Mark Fleming, chief economist with First American, “by largely the millennial first-time homebuyer, who hasn’t lost their job, thankfully, in the pandemic, and is trying to capture a 3.5% or lower mortgage rate with all of that buying power.”
Until mortgage rates start to go up, Fleming doesn’t see that changing.
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