Is now the time to buy? Lots of people think so....
By Troy Marsh, The Gold Key Experts (2/13/2008)
Over the last few weeks, I personally, as well as many of my colleagues that I have spoken to, have seen a fairly large uptick in traffic, offers and homes going into contract. Personally I have had clients involved in multiple offer situations twice in the last three weeks. Yesterday I had a client who started looking one week ago and two of the eight properties that he really liked had gone into contract within the last seven days. The media seems to be behind the curve on things and effecting how buyers who have not yet made a decision continue to look at the market.
The majority of the agents that I have talked to have spoken about the $100-225k price range being the busiest, which is mostly first-time home buyers or the “move up” sellers that are selling their homes to first-time home buyers. The problem with the media being behind the curve is that many buyers continue to “buy” the news that it is a severe buyers market and they can wait until they are ready, no matter how nice or well priced the home is, instead of pulling the trigger on a house they really like because the media says it will “be there forever.”
A week and a half ago I had three showings in Delaware County in the $150,000-$170,000 range with a buyer who had been involved in a multiple offer situation the weekend before. Out of the three houses we looked at, one listing agent called and said they had received an offer the same day we looked at it (now currently in contract) and another one of the houses we saw, which we ended up making an offer on, received a second offer the next day and put us into another multiple offer situation.
The Columbus Ohio real estate market is still a great place to buy a home, even if you are in this “busy” price range. The good thing for all the buyers out there is that the sellers are still listening to the same media who are saying that prices are going down and the market is bad. This has done two things:
1) Allows buyers to continue to get GREAT buys
2) Keeps unmotivated sellers out of the market
In my opinion, the reason for the increase in traffic is for a couple of reasons. The first reason is that interest rates are at historic lows around 5.5 percent average for a 30 yr. fixed mortgage over the last month. That allows people to afford a more expensive house for the same amount of money. The second reason is that due to the number of foreclosures and the tightening of the credit market, rental rates and competition have risen substantially. Foreclosures affect the rental market because the foreclosed households are not eligible to purchase a home right away and therefore are required to rent, and because the number of foreclosures in Ohio increased by over 80 percent last year over the previous year. This has injected a large number of renters into the market. The tightening of the credit market has also pushed many renters that have spotty credit histories out of the buying market until they get their credit back on track.
The drop in interest rates and the competitive rental market has taken away the price benefit of renting. These factors in combination with obvious benefits such as painting your walls the color that you want and having the freedom to do what you want in a home or condo that you own, has made this a very attractive time to buy for many first-time home buyers who over the last couple years felt like renting was a more attractive alternative to buying.
To contact Troy, email him at
troy@thegoldkeyexperts.com or call him at 614-325-8394.