With inventory down and the number of buyers on the rise, the West Michigan housing market continues to remain red hot heading into the middle of the summer.
According to statistics provided by the Michigan Regional Information Center, in the Holland and Saugatuck area, the number of active house listings are down 7% compared to last year and looking at northern Ottawa County, the number of active house listings are down 22%.
Briana Beyer, local Realtor for Coldwell Banker Schmidt, said that for her clients, it is currently a blitz to be the first through the house and from there, it is generally about putting in an offer over the asking price while also adding different stipulations to the offer to sweeten the pot.
"It is a wild market to be honest," Beyer said. "It is unique because the rates are low with interest rates being around 4.7%. So, you have people who are wanting to buy because you can get a good interest rate and they are out there buying. You also have sellers and they are hearing about how the prices are increasing and how this market is so strong so people are wondering how much their house is worth."
According to Beyer, it is not unusual for houses on the lower end of the market ($225,000 and under) to sell within a few days and with that, it is not unusual for a seller to receive multiple offers above asking price in that period of time. Beyer said if a buyer doesn't see a house on the day it is listed or the next day, the chances of getting that house decrease dramatically.
"If you are a buyer and you are not able to see that home in the first or second day, you have no chance," Beyer said. "For me as an agent, I have to be available no matter how busy I feel. If somebody wants to see a home and it is in that moving price point, I have to be available."
In the most recent data provided by Michigan Realtors, it said that as of April 2018, there have been 1,654 houses sold in the West Michigan Lakeshore Association jurisdiction, which is down less than 1 percent from 2017. Of those sales, the average sale price for the area was $199,679, nearly $3,000 more than last year.
When looking to buy homes in the under $200,000 range, both Beyer and real estate broker Dave DeYoung, also of Coldwell Banker Schmidt, said they use tactics like asking above asking price, waving the appraisal, making cash offers and in extreme cases waving the inspection just to help clients improve offers.
"If you can't use cash, you have to be creative when you write up and offer," Beyer said. "You have to word things and have the correct verbiage. Some people are foregoing appraisals. ... Even some, and I don't recommend this but some are doing no inspections. People will accept the house as is."
And while prices in the lower end of the market remain in high demand, DeYoung said that as buyers begin to look for houses in the $300,000 and up range, there is more time to buy. DeYoung said at that price point, it is not uncommon for a house to remain on the market for a month or longer.
"Once you get above $200,000, it starts to slow a little bit, so the $200,000 to $300,000 range is going to be a little bit slower than under $200,000," DeYoung said. "Above that, $300,000 to $350,000, you are going to have a little bit more breathing room. There is definitely more inventory in the market as the price increases."
With a housing market in the state it currently is, buyers continue to feel the pressure. Along with that, Realtors are putting in extra hours to try to accommodate for their clients.
"You definitely feel pressure from the buyer side for sure because if you get a text from someone telling you that a home just hit the market, my schedule usually runs four to five days out so I have to scramble to squish that in right now," DeYoung said. "If I don't get the buyer into a house in that first 24 hours, it is going to be gone the next day. There is definitely pressure to get people into homes."
With inventory down, a saving grace for local Realtors is the construction industry and the building of new homes in the area. New homes $275,000 and under do nothing but help at a time when people want to buy.
The tricky thing is that although the market is hot right now and has been for a period of time now, there is no way to tell how long it will remain the way it is.
"There has been talk that we are on a bubble and how we don't know how long this will last and how high prices can get but all we know is that it is strong right now, it is a good time to buy and it is a good time to sell," Beyer said. "Last year, it kind of felt like we were going on a bubble and yet we are still here. It's hard to say and it's hard to predict."
For people looking to get into the home buying and selling scene, there are certain things that can increase your chances. Whether it is ensuring you are pre-approved, hiring a Realtor or paying cash, the key is to differentiate yourself from other buyers and sellers. That said, going in realizing you may end up frustrated is a good start.
"Patience and persistence is key," DeYoung said. "I try to prep my buyers by telling them that they will very likely get frustrated. Do your best to use your patience and when you find the right home, step forward and don't squabble over $2,000. ... If you are going to get a home in this market in the under $200,00 range, you have to come in strong."
