A few places individuals are calling home today have changed because of market difficulties.
“We’re seeing a lot of changes in what people are buying and renting … because of the lack of inventory,” residential real estate investor Angelena Harris said during a recent JR/Now webinar.
Journal Record Editor Joe Dowd directed the conversation with Harris, overseeing agent at Spearhead Realty, and Monty Strickland of Realty Experts.
Harris said August postings for single-family homes – which numbered just about 7,000 of every 2020 – were down 47% this year to 3,298. Normal days on market went from 37 to 17.
Strickland said the pandemic brought about “one of the biggest real estate boom markets that we’ve ever had.” While home sales regularly drop off going into the holidays, the market has dialed back just marginally this year, he said. Sellers keep on getting various offers for houses, only not as numerous as throughout the mid year.
The MLS (various listing service) database that includes by far most of Oklahoma right now has around 3,200 to 3,400 listings. That is everything from a $6,000 property to a $8 million property, Strickland said.
“We’re seeing an increase in town house sales and condo sales that we haven’t seen in the past just because of the fact they can’t get single-family homes for an affordable price,” Harris said.
Supply chain issues likewise have influenced lodging stock. A few developers have changed to more modest homes like minimalistic living spaces or metropolitan infill projects, Harris said. “They can’t get the materials that they need to build – that’s the biggest problem – and so some of them are looking at alternative methods to building.”
Another factor is individuals changing out on the East and West coasts and coming to Oklahoma, where they are paying cash for houses on the grounds that the cost per square foot is extensively lower, the experts said.
For $300,000 or $400,000 in Oklahoma City they can get a truly pleasant house, a lot more pleasant than where they are moving from, Harris said.
“They’re coming from everywhere,” said Strickland, who in recent months has had clients from California, Florida, South Carolina, Austin and Chicago. “We’re seeing it a lot. … We’re still seeing a lot of activity over the asking price.”
For the past four months, merchants reliably have gotten 100% or a greater amount of the asking price, he said. Generally merchants get 95% to 98%.
“It’s a fantastic time to sell … because the median value has increased so much even since January of ’19,” Strickland said. “It has increased almost $50,000 in the Oklahoma City metro area.”
Harris said a few specialists in her office work with out-of-state financial backers and 1031 trade purchasers who are buying $200,000-in addition to homes “to rent them out and to park their money for a while … and Oklahoma is a safe place during inflation to do that.”
They are paying in cash and offering 5% over asking price to ensure they get the house since they need to move their cash rapidly so they don’t need to pay burdens on it, she said.
The circumstance has made it hard for local purchasers to contend, particularly first-time homebuyers, Strickland help. “It’s just created different obstacles and different hurdles … that we’ve just never had to encounter before.”
Harris said the rental investor market isn’t slowing down. “We have a major inventory shortage on rental property throughout the United States and I can definitely see that in our local market. People cannot find places to live,” she said. Part of that is because of the lack of rental houses.
Out-of-state syndications are coming in purchasing or building lofts on the grounds that the loan fees are low, she said. Commonly, they offer them in five to 10 years for a benefit.
Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No journalist was involved in the writing and production of this article.