The portion of the inventory that is considered distressed is still much smaller than it has been for years, and will continue to be that way.

If you look at the number of listings in the inventory, above, you will see that we had an increase in “normal” listings at the end of last year. That is because people who bought during the really low points or before about 2003 are putting their houses on the market. You see that January inventory is down a little bit.  I’m guessing this is because people think prices will go up, so they are holding off listing. But that’s tough to say –and it is a bit of a gamble for those folks who think they should wait.

Here’s why: while most folks think interest rates will stay where they are this year, I’m also hearing loan officers reporting that rates are starting to go up. You don’t want to try to sell a house while the interest rates are higher. It erases all of the price increase you were waiting for!

Still, you can see in this chart that the prices continue to go up, generally.

This is why you will see fewer investors in the market. First, their ability to get a super cheap house which they can flip up is going away in most areas. Second, it is more difficult to turn that house in to a rental and get cash flow when you bought it at a higher price.

I expect to see more “normal” buyers in the market, as those people who lost their credit scores recover and decide to pick up a new home.

If you are thinking about listing you home (even for short sale), please give me a call and let’s meet. If you are thinking of buying, let’s grab a cup of coffee and talk about your plans. We can build a strategy that gets you the home that you are looking for.

Call me at 602-456-9388.