(NewsNation Now) — Across America, the housing market is “hot.”
“It is so competitive that sellers can price their home above market value and still get a full priced offer from buyers just because of supply and demand,” said realtor Hayley Franklin.
According to Zillow, the typical U.S. home is sold within 13 days. In Kansas City, Missouri and Albuquerque, New Mexico, houses are selling in just three days.
In Charlotte, North Carolina, Denver, Colorado and Austin, Texas, houses are selling four days after they go on the market.
Realtor Charles Gerken described it as, “In the 16 years I’ve been a broker, this is by far the most exciting market we have seen.”
Chris Glynn, a Zillow Economist, says there are three main reasons why.
“The first is a huge wave of millennials that are aging into the peak ages of home ownership, the second is historically low interest rates that are pulling buyers in, and the third is what we call the great reshuffling which is homeowners in households re-evaluating their housing needs because of COVID-19 and perhaps moving to homes that better meet their needs,” explained Glynn.
Inventory is historically low which drives prices up. On top of that, new construction homes and condos are not being built fast enough.
South Florida developer and real estate broker Rich Kasser took NewsNation to see one of his projects. 200 units are “planned,” but right now, it’s just an empty field.
Supply shortages are causing construction delays around the country. Lumber is harder to find and the price has more than doubled.
“We are experiencing a lot of material shortages, and a lot of cost overruns because of those material shortages and labor shortages on this project,” stated Kasser.
Finishing materials and bathroom and kitchen appliances are also on back order because of the pandemic, according to the National Association of Homebuilders.
Dozens of cargo ships are bottlenecked off Los Angeles. Asian factories can’t send products fast enough and it’s overwhelming ports of entry.
New homesites that look almost finished from the outside are missing key components on the inside.
“A lot of these homes are under construction so it looks like there is a lot going on, but when you look inside there are just delays in getting refrigerators, appliances, windows, doors, and roof tiles,” said Kasser.
When asked if Kasser could sell all his homes if they were completed, he said immediately yes.
“Yeah. Every single one. If these were finished, this would be completely fully closed,” said Kasser.
There’s another factor contributing to the housing market craziness: the foreclosure and evictions moratorium put in place because of the pandemic.
Homeowners with federally backed mortgages can’t be foreclosed on.
So that entire chunk of the market is now not available.
“So we are seeing a lot of prices just go up, and up, and up. And usually the foreclosures, the auctions, the bank owned properties would help to kind of keep prices a little bit lower. And we are just not seeing that,” explained Kasser.
There is also a trickle-down effect impacting the market. For example, people waiting on a new construction house will wait to put their house on the market until they have a closing date which contributes to less inventory.
Experts say now is a good time to sell, but not necessarily the best time to buy, unless you’re willing to pay top price in many parts of the U.S.