Bad news for home buyers?
Where's the beef? For buyers, the much touted rebound in the real estate market is looking increasingly like all sizzle and no steak.
Massachusetts home sales jumped 21 percent in October,The Warren Group reports. It's a story that you will probably hear and read more than once today, if you haven't already.
Meanwhile home prices spiked 4.4 percent, rising to a median price of $287,000 according to the Massachusetts Association of Realtors, which also released its October numbers this morning. This is the biggest jump since the frenzied buying triggered by the end of the $8,000 home buyer tax credit in the summer of 2010. (The Warren Group, which includes foreclosures in its data mix, has home prices staying essentially flat at a median of $270,000.)
OK, this might be good for some sellers. But, when combined with a big drop in the number of homes on the market, the trio of surging sales, rising prices and falling inventory is definitely, positively and unquestionably bad news for bargain hunting buyers.
Yes, the most important number out there right now is inventory - how many homes on the market right now.
And the numbers are positively anemic, with single-family homes for sale having dropped more than 23 percent in October compared to October 2011.
The shift is even more dramatic when you look at how many months it would take to clear out the current lineup of homes on the market. This is a number that takes into account not just raw numbers, but the pace at which individual homes are selling.
We are down to 6.7 months of supply of unsold homes, compared to 10.5 months back in October 2011, MAR reports.
Buyers are suddenly faced with paying more, even as their choices and options steadily dwindle.
OK, if you have to sell a home to buy one, it could prove at least to be a wash - you may actually find a buyer for your house. But you are likely now to wind up paying more than you wanted for the next one.
Sorry first-time buyers, but the days of bargain hunting may soon be coming to an end.
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