Buyer clients are frustrated, says Marcia Edwards, real estate expert and principal broker. One of her clients recently said, after viewing yet another home that looked great online, “the homes currently for sale in my price point and areas of interest do not fit my current lifestyle.” The home had too closed off a floor plan, with formal areas the buyer felt she would never utilize.
Edwards’ client is not alone. Many would-be buyers are at a standstill in their plans due to the unusually low inventory of homes for sale. Lane County has not seen this low of an inventory of homes for sale in Eugene-Springfield since 2006, according to Trendgraphix. Due to the low inventory, the ‘absorption rate’ is down to three months inventory, says Edwards. (A balanced market offers approximately six months absorption.) More specifically, if no more homes were listed for sale and those on the market continued to sell at their current rate, inventory would be depleted within three months. Thus, the market is considered a strong sellers’ market, Edwards says.
A Realtor’s Advice
Due to this ongoing tight market, sellers who plan to purchase again after selling their home are hesitating, fearful that they will not find the home they are seeking once they have sold theirs. Edwards’ advice to buyers looking for homes in the $400,000+ price range is to build a home when they are not able to find what they want in the used-home inventory.
For reasons such as this, Edwards says building a home is appealing in the current market. Participating in the design of a home enables buyers to wrap the floor plan around their lifestyle instead of attempting to fit their life around an existing home.
Currently there are shovel-ready residential lots available in many areas of Eugene. Recently, experienced neighborhood designers/developers have stepped up and prepared beautiful building lots. However, constraints on the residential urban growth boundaries may limit land accessibility in the future. Buyers, thus, have a window of opportunity now, Edwards says. The most skilled veteran builders, along with several talented contemporary “green” builders, are looking to boost the inventory of homes in 2016. Edwards says many of these builders will design to the specifications of the buyer.
The prospect of building may seem overwhelming for buyers who have never built a home before. Locating the lot, drawing up a plan, staying within a budget and creating a home that is a sound investment when it comes time for resale are all critical points to consider. Where does the buyer begin?
Edwards advises to first choose the builder. She says that it is a common mistake to locate the land and/or floor plan first and then to ask builders to bid the building of the home on the buyer’s site based upon their plans. Or worse yet, the buyer chooses the builder because that builder owns a desirable lot. Edwards says all builders do not build alike; if the buyer’s intentions are to stay within a budget and to get a high-quality finished home, this approach may cost them. By interviewing and identifying the builder first, the builder will serve as an advisor, preventing the buyer from purchasing land that has hidden expenses such as tricky topography and/or storm water remediation requirements. Edwards says the builder has a vested interest in the buyer’s success, and because of this they will watch the buyer’s budget and ensure their success.