Redfin Real-Time Home Seller Survey Shows Sellers Sitting Tight; Buyers Fighting for Scraps
Low Inventory Unlikely to Improve Anytime Soon
SEATTLE, Aug. 20, 2012 /PRNewswire via COMTEX/ -- Redfin, a technology-powered real estate broker, ( www.redfin.com ) today released its first survey of home sellers. Data was collected less than two weeks ago, capturing sentiment of homeowners with the intent to sell. Eight hundred and sixteen homeowners from 20 markets across the U.S. responded. The Redfin Real-Time Home Seller Survey is a companion to the quarterly Buyer Survey, providing insight into why home inventory is at historic lows.
80% believe their home would fetch a higher price in one to two years;
46% would consider renting out their home rather than selling it;
32% intend to price their home higher than nearby comparable sales;
35% would choose an all-cash offer over higher, financed offers;
49% cited the economy as a major concern with selling;
13% believe it is a good time to sell; and
61% believe it is a good time to buy.
Taken together, the data suggests a market composed of reluctant sellers with low opinions of the market today, yet high expectations for the future. However, because so many sellers believe they should wait to sell for at least one year, and nearly half said they are considering renting out their existing home instead of selling, inventory is not likely to increase in the near future. And without more inventory, sales volume cannot meaningfully improve. While home price increases are good for consumer confidence, the housing market needs sales volume for a true recovery.
"I've carefully tracked prices on comparable homes in my neighborhood, but they have not yet risen to the level at which I'd want to sell; thus my desire to wait until spring 2013 (tentatively) and reevaluate the comps situation," said Jane MacKenzie, a homeowner in the San Diego area. "Hopefully by then some of the volatility in the stock market and the U.S./international scary headlines may have settled down a bit."
Glenn Kelman, the chief executive officer of Redfin said, "The would-be sellers we surveyed have made it clear that inventory is not going to meaningfully increase any time in 2012, which will limit sales volume gains -- and the lift that real estate delivers to the economy this year. We believe the main problem is not, as conventional wisdom would have it, that people can't sell because they're underwater on their mortgage. The problem with sales volume is that most home-owners just don't want to sell. And why would they? Most sellers believe prices will only get better over the next two years, and many can now rent their place for more than their monthly mortgage payment. The great majority of listings come from people relocating to another city rather than listing for market-driven reasons. We believe the owners who are listing their homes will continue to test demand for higher asking prices, while the builders who have plenty of homes to sell will have a big chunk of the market all to themselves."
Eric G. Tan, a Redfin listing specialist in Los Angeles added, "Because we are continuing to face such low inventory and a mass of home-buyers ready to compete for a good home in popular neighborhoods, most of the homes I'm listing are inciting bidding wars. Low appraisals, however, are keeping comps low and prices in check so we certainly won't see any drastic increases in home values in the next few months, and sellers who can wait to sell are choosing to do so."
Click here to see the full Redfin Real-Time Home Seller Survey.
About the Report
From August 10 to August 15, 2012, Redfin surveyed 5,851 people who had used the website in the previous three months, and indicated that they were a homeowner. Those who did not indicate an intention to sell their home were excluded. Eight hundred and sixteen people responded across 20 metropolitan markets in the U.S.: Atlanta, Austin, Baltimore, Boston, Chicago, Dallas, Denver, Las Vegas, Los Angeles, New York, Orange County, Philadelphia, Phoenix, Portland, Riverside / San Bernardino, Sacramento, San Diego, San Francisco, Seattle, and Washington DC.
Redfin ( www.redfin.com ) is a technology-powered real estate broker that represents people buying and selling homes. Founded and run by technologists, Redfin has a team of experienced, full-service real estate agents who are advocates, not sales-people, earning customer-satisfaction bonuses, not commissions. Redfin's online tools feature all the broker-listed homes for sale, as well as for-sale-by-owner properties that don't pay brokers a commission. The company serves 19 U.S. markets, and has closed more than $5 billion in home sales. Follow us on blog.redfin.com or our Twitter feed @redfin.