Is This the Best Seller’s Market Ever?

The inventory squeeze has left home buyers with fewer options on the market than they’ve seen in decades. While that’s bad news for them, the continuously high demand means it’s one of the best times to be a seller—ever.

“I’ve been selling real estate for 25 years, and this is the strongest seller’s market I have ever seen in my entire real estate career,” David Fogg, a sales associate with Keller Williams Realty World Media Center in Burbank, Calif., told CNBC. “A lot of our sellers are optimistically pricing their homes in today’s market, and I have to say, in most cases, we’re getting the home sold anyway.” He says he recently listed what’s considered an entry-level home in the area—a three-bedroom, two-bath, 1,240-square foot home—for $789,000. The seller received three offers before Fogg held the first open house, which 100 would-be buyers attended.

“It’s very tough. Most of the listings are intentionally listed a little low to get a lot of attention, and it’s not uncommon to get 12 to 16 offers on one property,” says Jilbert Mosessian, a renter in the Burbank area who is looking to buy a home. He says he recently put offers on three homes considerably higher than their listing prices, “and I was told that there were still five people above me and [the seller was] only going to deal with them.”

The inventory of homes for sale decreased by 6.6 percent at the end of March compared to a year ago, according to the National Association of REALTORS®. Unsold housing inventory is at a 3.8-month supply. Most economists consider a balanced market to be a five- to six-month supply. Forty-eight percent of homes in March sold in less than a month.

To better compete, buyers are dropping contingencies and offering more cash down. Real estate professionals also are bracing their clients for potential appraisal issues because in hot markets, homes may appraise below the bid-up sale price.

“I’m talking to the buyers in advance about these problems so that we address the appraisal issues before we go to escrow, and nobody is surprised in three weeks when we get an appraisal that’s on the lower side,” Fogg says.

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