Editor’s note: In this four-part series, we observe some of the latest changes taking place in housing markets – some subtle and some rapid. Read Part 1: Perfect home, perfect staging, imperfect market; Part 2: Housing inventory grows in some major markets and Part 3: The end of multiple offers.
Inman News has been watching the housing market closely, searching for clues of where this market might be heading. In our research, we observed what we believe are strong signs that the real estate tide is turning. They are:
1. Kinkos is busy: Copy/graphics/printing shops are producing volumes of fliers, postcards and other materials for Realtors to send out to promote listings. Realtors have to keep going back to these shops to print new marketing materials, reflecting reduced prices on properties that just aren’t selling as fast as they used to sell.
2. Ads get more graphic: Some brokers and agents in Colorado are including a graph of the 20-year home price appreciation forecast in their advertisements. They’re trying to show buyers there’s nothing to be afraid of, that buying a home now will not hurt them financially in the long run.
3. U-Haul has more trucks: People move around less when the market cools. They tend to take the stool pigeon approach: Nest in place and wait for the next boom before selling. We’ve noticed a glut of moving trucks sitting in lots unused.
4. Calling all contractors: Contractors are finding lots of work putting in new sprinkler systems and lawns, replacing roofs, and building fences, as home sellers realize they have to do something to improve their homes’ curb appeal. Home stagers also are getting in on the act.
5. My dog ate the contract: Agents are having trouble keeping buyers in contracts. Buyers are starting to realize they have some leverage with sellers, and that if they walk away from a deal because of a home inspection or some contingency that they are not going to lose the house. They recognize that homes are sitting on the market a little longer and that there are less people planning to make offers.
6. Newspapers are thicker: The home sections of many regional newspapers have beefed up in recent weeks with many more home listings than in previous months.
7. Open house parties are tame: It’s been much easier to visit open houses lately than in the last few years of the housing frenzy. There’s no more double parking outside and no waiting once you walk in the door. Also, those competitive glares amongst prospective buyers have softened to friendlier chatter.
8. Buyers have relaxed: Just a few months ago, you could pick a prospective home buyer out of a lineup by the look on his or her face: anxious, sweating and worn out from the fight to find a decent-priced home. Now, those looks are starting to fade as more shoppers have decided to kick back and rent until the market cools down a bit. Indeed, the University of Michigan’s Survey of Consumers found that consumers’ home-buying plans were at a 10-year low in September.
9. Bye-bye, newbies: “I’ve always wanted to be a teacher, anyway.” The crowds at those real estate licensing test sites have thinned out a bit compared with earlier this year and last year. If the market slows, real estate agents will be negotiating fewer deals, and for those who were barely making it in a hot market, a slow market means it’s time to look for a new profession.
10. Foreclosure sharks smell blood: One homeowner’s disaster is one investor’s dream. Lots of real estate agents and investors will get in on the foreclosure game, looking for steals – hey, they’ve got to make a living, right? There are reports that some real estate investors/investment companies have thrown millions into the New Orleans real estate market to grab up some storm-drenched real estate deals. Look for this sort of thing on a much broader geographic scale if the national boom goes “kaboom.”
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