The recent slowing in home prices, even amid continued low mortgage rates, has some housing market observers wondering whether six years of strong sales growth will end, letting buyers wrest the upper hand from sellers, especially in Las Vegas.
In May, Standard & Poor’s said its S&P CoreLogic Case-Shiller national home price index, the leading measure of U.S. home prices, showed a 3.7 percent annual gain in March, down from 3.9 percent in the previous month, showing that the rate of home price increases across the U.S. has continued to slow. Further, S&P said, home prices have declined for 12 straight months.
Opendoor said that whether buyers are gaining an advantage rests in the market’s absorption rate, defined as the number of months it would take for all listed homes in Las Vegas to be sold, assuming no new homes come onto the market.
An absorption rate of 6 or higher signals a buyer’s market, Opendoor said; an absorption rate below 3 signals a seller’s market. Markets with absorption rates between 3 and 6 are deemed balanced, Opendoor said.
Opendoor found that as of June, Las Vegas’ absorption rate is 3.98, meaning it would take just less than four months to clear through existing inventory. Therefore, the market remains balanced, trending toward sellers.
Opendoor, which is based in San Francisco and has Las Vegas offices, uses technology, including a smartphone app to radically transform and simplify the way homes are bought and sold across the country.
Top three tips for homebuyers in a seller’s market:
1. Write a strong offer: In a seller’s market, deal-seeking may hinder buyers. They should ask themselves how upset they’d be if they lost out on the house they’re looking to buy, and then write your offer accordingly. For homes potential buyers really love, perhaps going above the asking price is a smart tactic for offer-letter writing.
2. Schedule house tours quickly: Once an attractive property becomes available, it probably won’t last long. Buyers should, therefore, work to see newly listed homes as soon as they hit the market, even if it means rearranging their schedules. In this case, it’s better safe than sorry.
3. Don’t sweat aesthetics: Linoleum floors, less-than-desirable shades of paint in bedrooms, or kitchen cabinets that need updating are all things homebuyers can redo. None matter as much as having a well-built home with the space you need, a layout that fits your lifestyle and a price that allows you enough financial flexibility to make changes.