According to the NAHB (National Association of Homebuilders) “Multiple Offers For Homes on the Market Are Becoming More Common.”
Many potential buyers have been actively searching for a new home, have attended many open houses (live and virtual), written several contracts, and have been shut out each time. Many have searched for 3 months or more, without success.
This number was at 30% in the second quarter of 2020, up from 18% the year prior.
So what are their plans?
According to the NAHB, 51% will continue looking for the “right” home in the same preferred location.
37% will expand the search for their area. 21% are willing to accept a smaller/older home. And 19% might buy a more expensive home.
19% have decided to wait until next year or later. That share is up from 16% a year earlier.
However, there are more options and often better options.
Homebuilders are building homes at a greater pace than in the past couple of years.
Homebuilders started construction on homes at a seasonally-adjusted annual rate of 1.53 million in October, representing a 4.9% increase from the previous month’s figure, according to the U.S. Census Bureau.
And how does this help the homebuying public?
They now have an option.
Actually 3 options, all without a bidding war.
The buyer can purchase a vacant lot, or a larger acreage, and contract with a home builder to construct a new home on their property.
- The buyer can visit a new home sales office, enter into a conversation with the on-site sales manager, and contract to have a new home built.
- The buyer can visit a new home sales office and find out what homes the builder has in inventory. These homes are built without a buyer. The builder speculates on being able to sell these homes, no matter how far along they are in the home building process. Often these homes go all the way to completion and are available for immediate move-in.
It is very rare to have a bidding war on an inventory home.
The first step is for the buyer to interview and select a mortgage lender to get pre-qualified, then research and engage the services of a real estate agent who knows new construction. The agent will coach and guide you along the road to new homeownership.
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