raleigh north carolina just made number one on another list but unfortunately this time
it's not a good list we're gonna break it all down for you tell you all about it up next
hi this is chris morton real estate broker with exp realty in raleigh north carolina
and raleigh has made number one on a list again unfortunately this time
it ain't the good list so zillow recently came out with a report that said that raleigh north
carolina has the most dramatic reduction in housing inventory in the entire country
from last year to this year over 50 percent less houses available to buy this year than
last year on top of that LendingTree just came out with a report saying that raleigh was the third
most competitive market to buy a house in in the united states behind only san jose california
and san francisco california so what does all this mean to you if you're buying or selling a home
right now well we are not trying to scare you with this information we believe knowledge is power and
so we're going to break it all down for you give you the facts let you know where your solutions
may be and what the overall market solutions are going to be and make sure you stay until the end
because we are going to break down the average amounts buyers have to pay over asking price to
win the house of their dreams so first where are we now what is the current situation well there
are currently 1850 homes for sale in the raleigh durham chapel hill triangle area which sounds good
except we should have around 12,000 homes right now in a typical year in addition those 1850 homes
are in a population of 1.8 million people and we're adding a hundred people a day
to the market obviously this is making it very difficult to buy a house and so buyers are nervous
they're irrational they're getting easily upset and stressed out they're having to write multiple
offers on multiple houses and unfortunately they're losing most of their bids that they
put in on these houses even though they're paying way over asking price they're paying way more in
earnest money and due diligence money to secure the house and giving up all kinds of things like
they're waiving their inspection report so that the seller is not doing any repairs on the house
all kinds of things like that are happening and in normal years the asking price was always the
price that you started at and negotiated down from in today's market the asking price is really just
the beginning starting bid on most houses if you submit an offer to buy a house and your offer is
the asking price in most cases that's not going to win you the house now if the house is in bad
condition has been on the market a while there is a chance that you can negotiate down and that's a
little bit of a secret to throw you out throw out to you early that if you are finding it difficult
to find the house of your dreams maybe the house of your dreams needs to be bought and fixed up
just a thought and on the seller side sellers are getting top dollar for their house some are even
getting a little greedy and asking for even more money they're not having to do repairs and as you
can imagine this is great for the sellers but it's really bad for buyers they're getting very nervous
they're very tense about the situation they're going into buying homes sight unseen these buyers
are meaning they don't even get to go in the home before they make an offer on it and pay top dollar
and pay a lot of due diligence fee money that is most of the time not refundable you can imagine
this is a pretty toxic brew that is brewing here and because of this because of all this going on
about 20 to 25 percent of all homes under contract fall out of contract right now buyers get very
excited about buying a house based on the pictures based on emotional irrational exuberance about the
house they finally secure the house they finally can take a breath and they realize wait a minute
that house is an hour away from my work or they get to go in the house do an inspection
whether they are allowed to submit an inspection report to the seller or not they can still do
an inspection anyway they do an inspection and they find out there's all kinds of things wrong
with the house so this stuff is causing lots of homes to fall out of contract and sellers
are having to put homes back on the market so what can sellers do in this current hyper
active market well they don't want those contracts that we just talked about a second ago
to be cancelled because they've got a hassle of putting the home back on the market again
they gotta hassle with more showings on that home they gotta hassle with the stress of it all
and it probably is gonna mess up their plans to move to their next house so sellers need
to prepare ahead of time the most important thing everyone can do that i highly recommend if you're
thinking about selling your house is have it well staged have it decluttered have it look like a
model and when i say look like a model i think you know what i'm talking about if you ever have
been to a new construction neighborhood and go just gone and seen their models
there's no clutter everything is perfectly minimal and looks great and shiny and glisteny and awesome
buyers want that when they see your home they want that look to know that it's
at least perception is that it's in great shape when cleanliness tidiness shininess
is equivalent to a nice house for buyers but most sellers are going to think i don't need to
stage my home it's going to sell anyway and yep that's true it probably will sell if you're not
perfectly dulled your house up but know that even in today's market homes that are staged look good
repairs are done all of that stuff sell for top dollar so instead of getting a high offer on your
house you may get an obscenely high offer on your house it's worth your time to get the work done
the next thing i would recommend and i talked about it just a second ago is
repairs if there's anything big wrong with your house your roof your plumbing your electrical
heating and air system anything major wrong with your house go ahead and get it worked on
before you put your home on the market for sale or at least account for it and plan for
it and let the buyers know we know the roof has flaws and it's going to need to be replaced we
will be replacing it before the house sells so that will help put those buyers at ease
they're going to be less likely to cancel the contract when they discover the roof is
is bad if you let them know ahead of time the next step i would highly recommend you do is
get professional photography and professional full motion video done on your house before you put it
live to sell what professional photography and professional video does for your house is it shows
your house in the very best light and it also allows those buyers that maybe won't get a chance
to go in your house before they make an offer it allows them to see truly what your house is like
especially that full motion video and i am not talking about having your real estate agent do
those photos that move but they're still static i mean having someone go through the house with
a video camera and walk through the house as if they're touring a potential buyer through your
house if your real estate agent is not willing to do a full motion video like this you need to get
a new real estate agent it's absolutely mandatory in today's day and time that you have a video done
so that your buyers can see what your home is really like and they're not going to waste
your time writing an offer on a house that really doesn't work for them and worse yet
cancel a contract after you've accepted their contract and the last thing i would recommend
you do is make sure you fill out the residential property disclosure that your real estate agent
is going to give you make sure you fill that thing out as truthfully and accurately as you
possibly can don't deceive anyone by saying the roof is fine when you know the roof is not fine
it will get caught it's going to cause contracts to cancel and it'll cause all kinds of headaches
and heartaches for you down the road and for buyers what can you do in this situation well
the very first thing you must do is calm down i know it's stressful i know it's nerve-wracking i
know you need to be somewhere and you need to be somewhere fast but calm down relax and know that
your real estate agent if you work with us we're going to tell you the same thing calm down we will
find you a house the next thing i can tell you if you're a buyer start earlier than you think
you're going to need to start if you need to be somewhere in two months you need to probably start
looking three or four months out for that house go ahead and secure it maybe you can do a
rental back to the seller whatever needs to happen so for you to secure your house you don't want
to be running up against a one week deadline to be in a new town if you need to buy a house the
third thing i will tell you if you're thinking about buying a home is get real get honest with
what you need in a house and what you'd like to have on a house do not waste your time
your agent's time but especially your time going out and seeing homes that do not fit your needs
if you need a master bedroom on the first floor do not waste time going to see any houses with
master bedrooms on the third floor your rationale is going to be well maybe we can make it work and
yes you probably can make it work for a year or two but then you're going to be right back in this
situation again in a couple years and prices may be even higher don't waste your time seeing the
homes with the master bedroom on the third floor if you need it on the first floor the time you're
spending seeing those third floor master homes is time you could be spending seeing the ones
where the bedroom is where you need it to be the next thing i will tell you be prepared to pay
over asking price for that home we've talked about a little bit on this video we've talked about it
on other videos homes are selling for over asking price in general today so you need to be prepared
to pay over that if your maximum budget is say 400,000 you probably need to be looking at homes
in the 350,000 range hopefully you won't have to pay an extra fifty thousand for that house
but be prepared to do so look for homes under your price range
also if you can afford to go up in a price band definitely definitely recommended to do that
from zero dollars to 499,000 is right now our sweet spot in the raleigh triangle market
meaning that's where the most activity is that's where the most people are out competing
so if you can afford to go 500,000, 550, 6 on up you're gonna have a lot less competition
it's gonna be easier for you to secure that house and you're not gonna be stressed to
have to see a house and make a decision in 15-20 minutes and along those lines if you
aren't in the raleigh triangle market consult with your real estate agent find out what the
sweet spot is in your market in the house you're looking to buy so you know which price ban is
going to be the most competitive for you and you can know what to avoid if it's all possible
and finally for buyers if you are planning to buy a house site unseen where you don't go in the
house at all then you need to be very diligent in your research on this house look the photos over
if you can pinch and zoom photos on your ipad iphone or your computer to look for all the little
nooks and crannies please do that if the listing agent has provided a floor plan study that floor
plan make sure that the room sizes are going to be good for you that the configuration of the home
is going to be good for you hopefully there's a video that you can watch to kind of virtually tour
the home all the better that way that property disclosure i talked about earlier for the sellers
come through that make sure everything looks good if you have any concerns about something i had
clients that had a house that they really really wanted this week and we combed through
the property disclosure and found out there was a structural issue that the seller said they may
or may not be willing to fix that could have cost an additional 40,000 we of course did not
make an offer on that home but we would have never known it had we not combed through that
property disclosure and asked the right questions if you are local and in the raleigh area
then drive by the home take a look at the exterior see what the upkeep of the yard looks like that's
generally what the upkeep of the interior is going to look like and if you aren't available have your
real estate agent go do that for you and video it for you i do this all the time where i video the
exterior of a home that we can't get into upload it to youtube in an unbranded site that no one can
go to unless i send you the link and my buyers are able to get a feel for the at least the outside
if not the inside of the home and the last tip along these lines look at past sales of this house
and look at recent sales of the neighborhood to come up with a good idea about what you should pay
over asking unfortunately to get a feel for how much homes are going for over asking price in this
particular neighborhood so what are the possible solutions to get us out of this housing shortage
well the first one is for new construction to kick in and for more homes to be built unfortunately
this is a slow process you cannot build a home overnight it oftentimes takes a couple of years
to go through the permitting process and then at least five six seven months to build a house
basically home builders are still trying to get caught up from the great recession of
2008 through 2010 they still aren't there yet and then on top of that the pandemic caused
home building in general to slow down there's fewer vendors out there to be subcontractors
on homes lumber prices and other material prices have skyrocketed and are in short supply today so
this is all causing home building to slow down and unfortunately not be able to contribute in
the short term to this housing problem we have but in the long term it will kick in and will be
part of the solution the second solution to this problem is for more sellers to put their homes on
the market eventually word is going to get out what kind of profit someone's going to be able
to make on their home and more people are going to get off the fence and put their home for sale on
the market which is of course going to increase inventory beyond that the vaccine supply is
getting out there to combat the pandemic which is going to make some sellers more comfortable
about having people come in and out of their homes and that should as well increase supply
finally the other solution to this problem in regard to sellers is the silver tsunami that's
coming up this is basically when baby boomers are downsizing selling their current home
moving to a smaller home which will free up that inventory for people who need the larger
homes that these baby boomers are leaving and finally another solution to this problem is that
less buyers are going to be out buying eventually some of the buyers that are out today are going
to get frustrated with the process they're going to get frustrated with putting in
offers for 20 30 50 60,000 over the asking price and still not getting the house they're gonna give
up get on the sidelines and just rent somewhere or they're going to stay in their current home
situation until the marketing conditions improve and inventory improves beyond that interest
rates will eventually start rising and this will reduce the number of buyers that can afford a home
therefore reducing the number of buyers that are out there also at some point home prices are going
to get so high that some buyers are just going to get priced out of the market and are not going
to be able to afford to buy a house so that will reduce the population of buyers out there as well
and so all this will result in fewer buyers out chasing the homes that are on the market which
should hopefully get us close to an equilibrium so that for every buyer though we'll be available
home to buy so to give you an idea of how much home buyers have been paying over the asking price
to get into a home i'm going to break it down for you by the price bands so all the homes that make
up these price bands have sold in the last 30 days in wake county which is where raleigh is
and sold within a five day period of time so without further ado so in the 200 to 300,000
price category homes on average sold for 10,000 over asking price in the 300 to 400,000 price
category homes on average sold for 14,000 over asking price in the 400 to 500,000 price category
homes sold for over 19,000 over asking price in the 500 to 750,000 price category homes in this
category sold on average for 24,000 over asking price in the 750 to a million price category
home sold for on average 23,000 dollars over asking price and for homes over a million dollars
those homes sold on average for twenty two thousand dollars over asking price so now
let's look at some specific examples of homes that sold in the past month this home was listed for
two hundred and sixty thousand dollars sold in two days for three hundred and twenty thousand dollars
this home was listed for three hundred and sixty thousand dollars it sold in three days for four
hundred and ten thousand dollars and this home was listed for 1.2 million it sold in three days for
one million three hundred and twenty five thousand dollars and finally this home is an example of why
it is imperative for all home sellers to have their home looking great ready to go and perfect
when it hits the market so that the days on market are very very short this home was listed on the
market for 765,000 it sold for 745,000 after being on the market for 98 days so again it's essential
for you if you're thinking of selling your home to get everything right with your home and allow
everything to happen quickly so that you can get top dollar and you don't have to take a price
reduction in this day and age so that's where our current market is today for buying a home
in the raleigh wake county area i hope this has been helpful please like and subscribe below we'd
love to have you join us and we will see you next time for the next video thanks a lot take care bye