Homebuyers Undeterred by Seller’s Market; Willing to Pay More

For the latest Redfin Real-Time Home-Buyer report, we surveyed 1,353 active homebuyers who have recently toured homes with Redfin, in order to get their pulse on the market. While homebuyers’ frustration with low inventory continues to increase, there is also increased understanding of the seller’s market and a willingness to pay more. Expectations that prices will continue to increase remained largely unchanged, and concerns about overall economic stability continued to fall.

Key findings of this quarter’s report include:

  • Moving toward consensus that this is a seller’s market: Just 31% of buyers believe now is a good time to buy in their neighborhood, down from 40% last quarter.  More than twice as many–67%–see now as a good time to sell, up from 48% last quarter.
  • Increasingly willing to pay more: Forty-one percent of buyers indicated that low inventory has caused them to consider paying more for a home, up from 34% in the first quarter and just 26% in the fourth quarter.
  • Homebuyers anticipating further price increases remained unchanged: The percentage of homebuyers who anticipate further price increases in their neighborhood remained virtually unchanged from last quarter. Both quarters, 79% indicated a belief that prices will increase in the next 12 months. This quarter, 23% think prices will rise “a lot,” up just slightly from 22% last quarter.
  • Rising prices are an increasingly common concern: Forty-eight percent of buyers listed rising prices as a major concern, up from 40% last quarter.Sixty-five percent cited low inventory as a major concern in the first quarter, down slightly from 66% last quarter.

For the full report including data tables and charts, visit the Real-Time Market Sentiment in Redfin’s Research Center.

Discussion

  • Ben Hanson

    A note about insuring your home is warranted here. You may be pleasantly suprised that the rebuild cost (foundation up) on the home you’re buying is considerably more than the purchase price. This makes you realize you are getting a real “buy”!. Just make sure to INSURE it for that rebuild cost and NOT for the lesser amount for which you bought it.

  • http://savehouses.org/ Gerald Harris

    I currently live in Charlotte NC. I am originally from Southern CA, from what I understand there is a housing boom that is happening in that area. Supply and demand is apparent in that location. Buyers are lured into the market by low interest rates. As supply dries up, home prices are beginning to skyrocket. It is very interesting to see what is happening. As long as jobs support the local economy. Job growth and prime industry are of utmost importance, otherwise we will have a repeat of another bubble getting ready to burst!