US housing market loses some of its ‘frenzy’ as the list of homes for sale grows


So this time around, after months of watching the breakneck pace of real estate sales, he was ready for even more competition.

Instead, it was a lot easier. Mr. Coleman wasn’t even looking for a house. He and his fiancee, image consultant Rebecca Jahangeri, loved their townhouse in Washington, DC. Coleman remembers, “but I texted my dad and said, ‘Dude, I could buy this thing. “Two days later, he and Mrs. Jhangeri visited the six-bedroom brick Colonial and made an offer. Within hours it was accepted. It was the first house they saw and there was no other bidders They closed in June for $ 2 million.

“I was a little surprised, for sure,” said Mr. Coleman, 34, group vice president Jim Coleman Automotive. “I’m feeling lucky.”

It looks like last year’s wild residential real estate market is finally starting to calm down.

More and more homes are coming onto the market, according to real estate experts. For high-end properties in particular, inventories are rising as homeowners who have delayed the sale during the worst of the pandemic list their homes. Homeowners who weren’t planning to sell changed their minds after seeing prices soar higher and higher. Meanwhile, some deals made at the height of the frenzy have collapsed, while overpriced homes sit back rather than being immediately bought. The market is still warm, with strong demand supported by low interest rates, agents said, but buyers now have more options as sentiment to return to normal.

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House prices

“The sales market is no longer a frenzy,” said Andrea Ackerman, real estate agent at Brown Harris Stevens in the Hamptons, in the east end of Long Island.

Sales of existing homes across the country fell for a fourth consecutive month in May, according to the National Association of Realtors. In June, the number of new listings in the domestic market rose 11% from May and 5.5% from the same month last year, according to Realtor.com’s monthly housing report. And while total active inventories are down 43% from the same period last year, this is an improvement from a 60% difference in May, said George Ratiu, Senior Economist at Realtor.com. (News Corp, owner of The Wall Street Journal, also operates Realtor.com under license from the National Association of Realtors.)

“We all felt, 60 days ago, that we were literally going to run out of inventory,” said real estate agent Jonathan Boxer of Douglas Elliman in Aspen, Colorado. “And then things changed. We started to attract new sellers.”

Price growth has slowed with more and more listings in the market across the country, Ratiu said. In June, the median listing price rose 12.7% year-on-year, from a 17.2% jump in April. He said he expects growth to continue to slow over the next year. Overall, said Mr. Ratiu, “I see this current market starting to look a lot more like a normal market. “

Until recently, Brooklyn residents Michelle and Dan Mannix believed they would never sell their country home in Orient Village on North Fork on Long Island.

“We used it throughout the pandemic and it was a godsend,” Ms Mannix said of the house, which the couple, who are serial entrepreneurs, bought 14 years ago for weekends. ends and holidays. When the pandemic broke, they moved to the East. full time with their son. “I would say, ‘We’re never going to sell’. Then all of a sudden things started to change. “

They watched in wonder the house prices in North Fork soar. A house a few blocks from theirs sold in 72 hours for $ 2.5 million, “a lot more money than anyone had seen recently,” said Ms. Mannix, 50. ‘It made our wheels spin. “

The couple, who returned to Brooklyn in October, decided to put the Orient house on the market. They listed him at the end of May for $ 2.466 million with Lori Feilen of Town & Country Real Estate. In mid-July, the Mannixes reduced the price to $ 2.196 million. However, there have been no offers yet and Ms Mannix said there was more competition than she expected, with new announcements appearing after months the tiny hamlet had failed. hardly any houses for sale. “It was like there never had been anything, and now since we’ve put our house on the market I’ve seen three or four really cool listings,” she said. “For Orient, that’s a lot.”

There were 13 real estate listings in the Orient market at the end of June, up 62.5% from the monthly average of eight listings in the region over the past year, according to Realtor.com.

While demand is still high, the urgency of some buyers has faded as they go on vacation, visit family, or spend weekends at the beach rather than open houses, said Chris Itteilag of Washington Fine Properties, who represented Mr. Coleman in his purchase of a La maison du Potomac. Others, tired of high prices and competition, take a break from finding accommodation. Highly sought-after properties always generate bidding wars, Itteilag said, but others remain on the market, especially if they are overpriced or in need of renovation. “It’s more random or property specific,” he said.

In Montgomery County, where Potomac is located, 1,855 new listings hit the market in May, a 49% jump from May 2020, according to Bright MLS.

Across the country, luxury properties are entering the market in greater numbers than low-cost homes, Ratiu said. The number of new listings over $ 1 million jumped 17.5% year-over-year in the week ended June 19, according to Realtor.com, while new listings under $ 350,000 fell 7.4%. The total inventory of homes for sale over $ 1 million was still down 23% from a year ago, but listings below $ 350,000 fell 49%.

High-end listings are more plentiful in part because investors who have purchased single-family homes tend to buy homes on the cheap to maximize returns, Mr. Ratiu said. Another factor is that some sellers are overvaluing their homes – a phenomenon he called a “moving price” – but buyers are reluctant to pay too much, unlike at the start of the pandemic.

For many sellers, it was just not practical to list their homes at the start of the pandemic.

This was the case for the clients of Ms. Ackerman, Robert Kushner and Trevor Yoder. The couple have owned their barn-style home in the Hamptons for 20 years, sometimes living there full-time and sometimes using it as a weekend getaway from their Manhattan apartment. “We have had a big Thanksgiving in this house for years,” said Mr. Kushner, 56.

But the couple are now developing a hotel and residential project in Costa Rica, where Mr. Yoder lives for months. They had planned to sell the East Hampton property and move to Costa Rica, but the pandemic made it difficult to complete any renovations they wanted to do before listing the house. “When people buy or rent here, they expect things to look just as good as when they are new,” Kushner said.

Rather than sell it, they rented the property. Then, as the Covid restrictions began to ease, they carried out the renovations as quickly as possible, redone the floors and repainted. They put the house up for sale on June 14 for $ 7.25 million, as well as on lease for $ 195,000 for August. The rent has since been lowered to $ 150,000. Mr Kushner says they won’t sell if they’re not happy with the price. “We want to see what the market can handle right now,” he said. “If it sells, so much the better. If it is rented, that is fine with us as well.”

This story was posted from an agency feed with no text editing. Only the title has been changed.

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