Our market seems like it is hotter than Monday's all time record afternoon high temp, but digging into the numbers reveals our seller's market is only tenuous at best. Multiple listing service stats show Clark County over the last three months has only had about 150-200 transactions per month which is well under the 400-600 we are accustomed to seeing in the springtime. The culprit isn't a lack of demand but rather a lack of inventory. It looks like the pandemic left a chink in the armor of the real estate market. It seems few people want to sell their home.
I get it, Clark County is a great place to live and this area routinely finds its way onto best place to live type articles in various national magazines. But sellers seem to be worried about their ability to buy another house when they get their current home in contract. That is a fair consideration but it is exasperating our dilemma with inventory. Sellers are in control of the market, they can easily dictate terms of sale to buyers including longer escrow periods and rent back after close clauses to allow them time to acquire a replacement home.
Personally I had by best year ever in closed volume in 2020 and one of my best in total units closed and this year I have been off to a rather sluggish start. Largely due to a lack of listings. Many of my clients that are in that 'sweet spot' 5-8 years since they bought their last home are not interested in selling. Everyone seems to be content, whether truly so or worried about an uncertain economic future, they are choosing to stay put.
The listings I am getting this year are almost exclusively people that are leaving the area to either retire or for an employment change. The "move up" market seems almost dead. Prior to the COVID 19 pandemic new home builders were making a killing by providing inventory to a very hungry market, but alas, they have run into high cost of materials and a flat out lack of materials to keep pace.
The bottom line is that this sizzling hot market is at least a bit of a mirage as it is completely supply side driven. The number of buyers is shrinking due to affordability, but the number of homes for sale is also shrinking and or flat. Prior to COVID we had a robust almost neutral market slightly favoring sellers and now we have a much smaller market with tight inventory and a bidding war on nearly every home that comes to market in the price ranges from $300k-$900k.
Hopefully the materials shortage will ease up and allow home builders a chance to continue providing new home inventory. That could be the trigger mechanism for would be sellers as they would not have the concern of finding a replacement home when they sell their current home.