The homebuyers are back in town.
Home sales surged nearly 10 percent in March after some disappointing results in prior months, while prices dipped slightly.
But the market isn’t keeping up, as the number of homes on the market fell to a four-year low.
Yet as the current busy season heats up, sales are starting to sizzle, according to Tammy Capozzi, a broker with MJ Peterson. Multiple-offer situations are common, many houses are selling above asking price and she said she has seen the occasional cash deal.
“Houses are selling lickety split,” Capozzi said. “Buyers are being aggressive because they’re seeing the trend with supply and demand.”
But, as always, the market can vary greatly from one location to the next, she said. While sales in parts of Buffalo, Amherst, Clarence and Williamsville have been brisk, they have been sluggish in Lockport, Wheatfield and Pendleton.
Alison Walter-Coldicott has seen that firsthand. She and her husband moved to Lockport two years ago to be closer to his job at Yahoo but decided to move closer to family after she had a child. Their house has been on the market for 90 days and they have already lowered their asking price by $20,000. They made a contingent offer on a new home, but the seller eventually went with another offer.
“We’re finding the market is not good here,” she said. “We just cannot sell this place.”
According to the Buffalo Niagara Association of Realtors, agents tallied 680 deal closings in March, up 9.9 percent from 619 in March 2014. That’s the most since November, before the worst of winter set in.
More importantly, it’s the most for March since the go-go years of 2008 and before. For the full first quarter, closed deals were up 4.2 percent to 1,788.
Pending sales were also higher in March, up 6.6 percent to 996. Those are deals where a house is under contract but the deed hasn’t transferred.
That’s the highest for the month in almost a decade, since 2006, and the highest for any month since last summer, indicating pent-up demand coming out in a hurry. So far this year, pending sales are up 10 percent to 2,442 for the first three months.
More homeowners listed their properties for sale in response, as new listings ticked up 1.1 percent to 1,438, although that’s still below the average for the last 15 years. Since January, 3,577 homes have been added to the market, a 4.1 percent increase over the same three months last year.
But that’s nowhere near enough to sustain the inventory at prior levels. The total number of available homes for sale dropped 10 percent to 3,969. That’s the lowest inventory for any month since January 2011.
As a result, the existing supply of homes for sale will last only 4.4 months at the current pace – well below the six-month level for a stable market. So competition for remaining homes is likely to be hot and heavy, especially in popular neighborhoods, and buyers may have a harder time finding what they want – even if they’re willing to pay.
“Interest rates have been low and I think people have refinanced and stayed put instead of buying bigger and extending themselves,” Capozzi said.
The pressure on supply and demand didn’t trigger a price surge in March, but prices could climb along with the temperatures this summer. The average sale price for March fell 2.1 percent to $138,435, while the median dipped 1.7 percent to $115,000.
BNAR’s figures are based on arms-length transactions by members of the trade group in the eight-county region of Western New York, plus a few sales in Monroe and Livingston counties.