Low Inventory Gives Home Sellers More Options. Can You Say “As Is”?
Most Real Estate markets follow National trends at some point and Arizona is firmly entrenched in this one as we speak. Inventory is low, demand is increasing, and if it’s for sale, it will sell. This isn’t to say that condition doesn’t matter at all. Case in point, a smallish home in Chandler, Arizona that I listed this past week, under contract in two days. Why? I can say with confidence, it was condition. This home was spotless and upkeep was impeccable. Had it been in disrepair, would it have sold? Absolutely, though perhaps not in 2 days. As a matter of fact, homes in need of TLC are ‘flying off the shelves’, especially in Gilbert and Chandler. It’s a market that probably won’t last, these things cycle constantly. But for now, if you own a fixer-upper, and have been wondering when is best time to sell, it is now, while inventory is at its lowest.
Fixer-uppers have become a force to contend with. Not considering price range, the number of available listings identified as “fixer-uppers” has increased 12 percent across-the-board in the last five years, according to a recent Zillow analysis.
The reason? Buyer competition could be giving home sellers the go-ahead to list their home “as-is,” says Zillow Chief Economist Svenja Gudell. Lower than normal inventory allows sellers this flexibility because the home will likely sell either way.
“Across the country, homes are selling fast and for higher prices,” says Gudell. “Sellers are in the driver’s seat, with the freedom to list their home for sale ‘as-is’ without worrying about price cuts or the home sitting on the market—and without sufficient new construction, the housing stock has aged, so home buyers are finding more and more homes on the market in need of a little TLC.”
The Higher-priced fixers market has grown aggressively since 2011—close to 35 percent, according to the findings of the analysis. By comparison, the amount of lower-priced homes in need of repair has grown by only about 3 percent. However you might logically assume that a home is in the lower prices range ‘because’ it is in need of repair, which could explain the disparity.
Using Seattle as an example, overall available inventory decreased 10 percent over five years, even as inventory of homes in need of repair has risen by 33 percent. In addition, the age of the typical home sold has doubled in just nine years—in 2006, the median age of homes on the market was 15 years old; by the end of 2015, the median age jumped to 28 years, according to the findings of the analysis.
To conduct the analysis, Zillow identified the number of fixer-uppers listed for sale beginning in 2011 and ending in 2015, and compared them to overall for-sale inventory trends. To identify fixer-uppers, Zillow mined historical listing descriptions for phrases like “fixer-upper,” “TLC” and “needs work.”
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Bill Salvatore / Arizona Elite Properties
For more information, please visit www.zillow.com. Reprinted with permission from RISMedia. ©2016. All rights reserved.
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