Post-recession buyers are on the prowl for the perfect house at the perfect price, according to the New York Times.
Exacting buyers are upending the battered real estate market, agents and other experts say, leading to last-minute demands for multiple concessions, bruised feelings on all sides and many more collapsed deals than usual.
Before the boom, the sellers often had the upper-hand in the competition over the sale of their home, but the roles have now flipped. Many brokers are seeing a new trend in buyers who make demands at the last minute knowing the seller’s other alternative may be to place their undervalued home back on the market.
After the $8000 tax credit expired, a temporary housing slump was expected, but the results have been more drastic than initially expected. In some places sales dropped 20% from May 2009. Builders are also seeing a decrease in home sales, down 17.2% since April. Building permits for future construction dropped 10% which will result in a decrease of home building this summer.
Even the lowest home mortgage rates in decades are not doing much to invite deals. The Mortgage Bankers Association said Wednesday that applications for loans to buy houses were down by a third compared with last year. Applications are back to the level of the mid-1990s, when the country’s housing market was smaller.
Buyers feel they are being smart, yet many sellers cannot afford to make many concessions. A few $1000 could push them under the water and push the sale into one directed by the bank.
Since many of the sales were initiated just before the April 30th cut-off for the tax credit, the numbers will continue to be reported through June. The real result of which will not be known until the fall of this year.
On the upside, some experts argue that come July people will need to start buying again, and the Mortgage Bankers Association did note that the purchase application index rose slightly this week after a 5-week decline.
