Inventory & Buying in Today's Market

If you’re in the market for a new home in southwestern Vermont, you might be frustrated that there are so few available. We call this a “lack of inventory.” 

Perhaps you’ve been driving around and seeing tons of “FOR SALE” signs. It appears that there are a lot of homes on the market. Believe it or not, Vermont’s sign laws do not allow banners/riders indicating that real estate is “under contract” or “pending.” It would be a lot of extra work to put the sign up & down every time it goes under contract, so we leave them up until closing. This practice of advertising both Active and Pending listings gives a false sense of availability. Many of them are already under contract. 

Southern Vermont Real Estate By The Numbers

To put this into perspective, here are the number of “active” single-family homes listed on the market today, January 20. These are available for showings/offers:

Bennington 34
Woodford 2
Pownal 5
Shaftsbury 7
Arlington 7
Sunderland 2
Manchester 14

Likewise, as of today, in those same towns, here are the number of single-family homes that are currently “active under contract” (which means the seller still wants showings) or “pending” (seller does not want more showings, listing is no longer on third-party websites):

Bennington 23
Woodford 4
Pownal 6
Shaftsbury 12
Arlington 8
Sunderland 1
Manchester 15

In most of our local southwestern Vermont towns there are a balance number or even more sales pending then there are still active. If they all have a “for sale” sign in the yard it looks like there are twice as many homes available than there are. 

Not having very many choices, especially when making a huge financial decision/investment, creates stress and uncertainty. Consider the speed of our current market. Many homes are selling within the first few days on the market with multiple offers over the asking price. Now you start to understand the pressure cooker experience that’s occurring. 

Pressure Cooker Intensity

Sometimes, buyers end up having second thoughts, or “buyer’s remorse.” Right now, it’s at an all-time high for my 10-year career. Typically in a full year I might have one sale terminate due to an unsatisfactory inspection or the buyer being denied mortgage financing. In 2020, I had 11 terminated deals. Eleven!  Most were caused by this market’s pressure, low inventory, competition among buyers, and having to make decisions quickly. Additionally, COVID means out of state buyers cannot see houses in person due to travel guidelines. They make an offer “site unseen” and change their mind after seeing the house in person.  It can be a rollercoaster for sellers, who just want to sell!

Some buyers perceive our advice and counsel to make an offer quickly as a false sense of pressure, to make the sale. Spend a day in my shoes working in this market, and you’ll understand that the struggle is real. Most Realtors care very deeply about their customers and clients... When you want to buy a home, our goal is to help you get the house that you want, and ideally, at a price you’re comfortable with. If you delay even for a day, it might be gone tomorrow. The seller has no obligation to wait around for all offers... they can take one they like whenever.

Choosing an Agent as Your Ally

Is there a way around this chaos? I think so. I believe in educating the public so they can make an informed decision. Maybe now is the right time for you to buy... or maybe it’s in 3-6 months when there is hopefully more inventory.  I’m currently working on 6 new listings -- and already have a buyer in mind for most of them.  It's an amazing opportunity to take advantage of the crazy low interest rates. My best advice?  If you can comfortably afford the payments, lock in for a 15-year mortgage and you'll save a FORTUNE by shortening the term down from the traditional 30-year mortgage.  

A key ingredient for buyers to be successful in this highly dramatic market is to work with one agent who knows exactly what you’re looking for, getting you poised and ready to act when “the one” is for sale, and is highly responsive to your needs, including video showings and "face to face" Zoom calls to review offers before submitting. You’re investing YOURSELF in this process and should be partnered with someone who is entrenched in the day-to-day operations of the market and is on stand-by to help you. 

For more information, reach out to Jenifer Prouty Hoffman by email Jenifer@HoffmanVTRealEstate.com or call/text 802-558-5911.