Where Are All of the Sellers?

The real estate market remains white hot. Properties that are listed stay on the market for days, not months. Interest rates are still at all time lows. Rents continue to rise, encouraging renters to make the plunge into home ownership. It is the perfect time to sell! But there is one problem: nobody is selling their home. In the city of Salem, where seeing fifty to one hundred single family homes on the market at any given time is the norm, there are exactly twenty homes on the market as of this writing. Twenty!

Depending on the market and the price point, inventory is still at record lows. Essex County, where I sell real estate, has seen a slight uptick in listings over this time last year. Those numbers can be deceiving though. First of all, we remember those terrible storms of 2015. We were still digging out last year, not planning to sell. Also, a more in-depth look at the numbers show that the most expensive listings, homes priced at $750,000 or more, are more common than they were last year. The number of more affordable homes listed is much lower than it was in 2015.

There are several reasons for this. First, homeowners are concerned about equity. Some fear that their home values have not rebounded since the economic collapse. Other homeowners are reluctant to sell for fear of not being able to find something to buy. In fact, just yesterday I met a young family who did sell their home but still has not found a suitable replacement. They currently are in a month-to-month lease in Salem until the right home does hit the market. There is not a lot of new construction in Essex County either, especially in cities in towns with limited land left to develop, like Salem.

At some point, something is going to have to give...