Frustration Grows Among Buyers as Home Prices are Rising Faster than Inflation
The signs of a crazy spring home buying season can be seen and felt across the country, as buyers flock the market and listings are going off as soon as they are posted. While the odds are definitely in the sellers' favor, buyers are becoming increasingly frustrated over the rising prices of homes in the market. Can first-time buyers still keep up with the high prices?
As previously reported here on Realty Today, there is an increase in the demand for more homes in the market as mortgage rates are close to reaching its lowest in years. As the demand for more homes increases and the inventory remains tight, this has led to an increase in the selling prices of homes in the real estate market.
It has also resulted in several bidding wars, which often makes it harder for first-time buyers. Realtor.com notes that prices of homes in several markets in the U.S. are rising five times faster than inflation.
For instance, prices of homes in the Pacific Northwest are rising four to five times faster than inflation because of the tight inventory of existing homes for sale as well as a low construction of new homes. In Portland, OR, prices of homes rose to 11.9 percent.
"I'm seeing a lot of frustration on the buying end," said Portland real estate agent Amanda Haworth.
Haworth told the publication that buyers usually put in six to 10 offers before they can finally find a home to buy. This means that buyers are usually offering more than the asking price of the house being sold in order to win against other buyers and investors.
Seattle also saw an 11 percent increase in the prices of homes for sale in the region. In Denver, the selling prices of homes went up by 9.7 percent.
First-time buyers may continue to feel frustrated over the continuous rise in the prices of homes in the market. Several experts say that this condition will remain for at least a year before the market reaches its plateau.