Is Tight Inventory a Product of the Pandemic?

It's hard to say why homeowners are choosing largely to stay put, but with interest rates still very low, the traditional case study suggest they would capitalize on substantial equity gains and move up. They are not doing it this time and the only real difference is the pandemic. 

Are homeowners nervous about the future economy, the persistent potential for lockdowns, or is it some other cultural shift in the mentality of homeowners. Are millennials taking a different approach to homeownership than their parents who on average bought a new one every seven years. Perhaps they will be more like their great grandparents? Are millennials going to be a generation that stays in their first house through retirement?

I hope not, as that would not be good for us Realtors® ;) A lack of resale homes leads to a tight market and higher prices for entry level buyers. If millennials end up a buy and hold generation, the market for Gen Z will be really tough.

Baby boomers were perhaps a little too 'loose' with their equity, but one can also be too tight with it as well. Using the equity to buy a larger home or a home in a better neighborhood, closer to work, or another life benefit is not a bad idea. As with all good things in life, just don't abuse them.

Listings Hard to Find

Listings are tight and that means the market will remain difficult for buyers and excellent for sellers. Our transition into the neutral market seems to be sliding back in favor of sellers. It seems that sellers are staying put. Vancouver and Clark County remain a hot destination as new people from Oregon and Seattle are flowing into the region. Meanwhile few Clark County people want to leave. A possible additional complication is that people in a position to move up may be uncertain about the economic future with COVID still raging and uncertainly in future governmental policy. If this is the case then that leaves even fewer new listings in a market filled with ready, able, and willing buyers.

I think the vaccine roll out and a slowdown in new cases later in the spring (hopefully) will ease the jitters of some local move-up sellers. This should help boost inventory in the traditional spring season.

If you are thinking about upgrading your home now could be the perfect time. You will get top dollar for your current home maximize its equity thus putting you in a stronger position ie. larger down payment, lower future payment, etc. when you offer on the next home. Interest rates remain extremely low, but that may not be the case in the future since the feds are printing massive amounts of dollars to combat COVID-19. Even if the housing market were to take a dip next year, the interest rates combined with he capture of a large equity pool would most likely carry you through any future downtown, grinning.

Reach out to me or your local trusted agent today to find out what your specific situation looks like.

Value Neighborhoods, in Vancouver

Vancouver has several neighborhoods that offer disproportionate value. When considering a home that is seemingly undervalued one must be cautious and rely at least in part on the counsel of a qualified local agent and their own good common sense. 

The standard price per foot model is unreliable. One must determine why the house is less. generally there is the actual property characteristics, condition, location, age, etc. But external conditions such as neighborhood crime, schools, accessibility to services and infrastructure can also be factors. Once these are evaluated and the property still seems like a deal, then it could be local perception. This is a very intangible thing that is as real at times as other more tactile facts. 

Perhaps a neighborhood was once very run down and filled with crime and other undesirable elements, but some improvements began in recent years that has transformed the area into a more moderate neighborhood. Things may even be continuing to improve. Many people will still hold on to past perceptions of the area and thus not offer higher values for otherwise excellent properties. This is once again where a true real estate professional can help. Many agents are guilty of holding on to past perceptions and the best among local pros are well studied and aware of these dynamics that can lead to a potential value opportunity for a buyer.

The opposite can be true as well. A neighborhood with a sterling reputation can be on the downward trend and fetch more for homes based again on local perceptions. It is not a bad idea to test your agent on general knowledge of neighborhoods and communities before writing offers. No agent knows every nook and cranny of a county like Clark with 625 square miles and 500,000 people. Good agents will know a great deal though. The best agents will help their clients see things they might not otherwise notice, either beneficial facts or derogatory items. In either case the buyer will make better decisions and quite possibly find a value property in this crazy tight market.