Home Sellers Can't Sell If They Can't Find a Next Home to Move Into
NEW YORK (TheStreet) -- There's some good news for U.S. homeowners in early 2014, especially those who want to sell.
Data from Seattle's Redfin citing figures culled from 19 major real estate markets show home prices up 14.3% in January from a year earlier. All 19 markets posted gains on home values.
At the same time, there is a lack of homes for sale, with inventory down 9.4% from a year earlier due to a lack of "demand growth," the company says.
Redfin says only 28% of its customers made an offer on a "for sale" home last month, compared with 42% at the same time in 2013. That's the case even as homebuyers taking in visits to homes remains stable at 50% -- it's just that those visits aren't leading to offers.
Home sellers are still bullish.
The number of American homeowners who say "now is a good time to sell" rose 4% in January. Holding them back is a fear that they won't be able to find a good deal on a next home.
"Most of my home-selling clients worry the most about what will happen after they sell," says Paul Stone, a Denver real estate agent. "With so much competition in the market, they fear they will have to move in with their in-laws if they can't find their next home quickly."
Overall, 38% of home sellers say that early 2014 is a good time to sell -- up from 22% in January 2013.
Even so, Redfin says that most sellers are waiting until spring to hang that "for sale" sign on their lawn. The company says the market will be especially hot from March to May as the brutal weather in most of the U.S. melts away.
Another reason for the delay: Americans are convinced their homes will sell quickly, so they're in no rush to sell, and would rather take the time to spruce up their homes to add more value to the final sales price.
All in all, home sellers have more leverage than at any time in the past five years. If enough of them put their homes on the market, that should alleviate low inventory problems, too, making the spring selling season the liveliest in a half-decade.