Spring market worry: A dearth of homes for sale
A shortage of for-sale inventory again threatens to derail the full recovery of the residential real estate market, both nationwide and in the Philadelphia region.
A shortage of for-sale inventory again threatens to derail the full recovery of the residential real estate market, both nationwide and in the Philadelphia region.
The National Association of Realtors on Monday blamed February's lackluster sales of previously owned homes on "unshakably low supply levels and steadfast price growth" in parts of the United States.
Low inventory of homes was a contributing factor in the 7.1 percent decline in national sales in February from January's levels after six positive months, the Realtors group said. Still, the numbers were 2.2 percent higher than February 2015 levels.
Although monthly sales reports are rarely a consistent indicator of the long-term health of the housing market, a shortage of inventory at the start of the spring real estate market is worrisome.
Nationally, the number of homes for sale has fallen 40 percent since 2012, Trulia, the San Francisco-based real estate search engine, reported Monday.
"Heading into the spring house-hunting season, inventory remains tight and affordability is worsening, especially for starter [first-time] home buyers," Trulia said.
Though the Realtors group's chief economist, Lawrence Yun, also coupled the inventory shortage with "an affordability problem" - prices are rising in other areas of the country - the same is not necessarily true in the Philadelphia area, local observers say.
"In virtually every individual market that we track throughout Bucks County, by traditional measures - meaning that less than six months of inventory indicates a seller's market - we are experiencing an inventory shortage," said Martin Millner of Coldwell Banker Hearthside Realtors, in Yardley.
He also said there were "a fair amount of overpriced homes" on the market that haven't sold because of that factor.
Millner added, however, that "the inventory shortage has not translated into any significant amount of [price] appreciation."
On the contrary, many agents said, homeowners are waiting to list their houses until prices recover enough for them to sell without losing a lot of money.
In the city, "we are really finding inventory shortages all across the board - especially for nice-looking properties within strong neighborhoods," said Mark Wade of Berkshire Hathaway Home Services Fox & Roach Realtors, in Center City. "Demand is outweighing supply."
For February, BHHS Fox & Roach Realtors' HomExpert Market Report showed inventory in the eight-county region down about 3,100 houses from the same month in 2015.
Sales were down by 135 units - from 3,792 in January to 3,657 in February, though that was up 13.9 percent over the levels of February 2015.
Gary Segal of Keller Williams Real Estate, in Blue Bell, said there is an inventory shortage in the Conshohocken area. And in towns such as Whitpain, Springfield, Upper Dublin, Horsham and Lower Gwynedd, he noted, there is a shortage of listings at the $350,000 price point.
"The highest end of the [suburban] market has the opposite problem: too many listings over $1 million," Segal said.
John Duffy of Duffy Real Estate, on the Main Line, noted: "We could use more homes in the $500,000 to $750,000 price range in the suburbs, and any price range in certain areas of the city," where his agents also sell homes.
The "best advice I give to my buyers," Wade said, "is to take their time to look around and learn what they truly want."
But the minute they see the house for them, "strike like lightning - hot and heavy," he said.
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