(WGHP) — The red-hot housing market has seen median home prices soar since the beginning of the COVID-19 pandemic, which is great for sellers. For buyers? Not so much.
“There’s so many people that are getting so many bids on houses like constantly, constantly, constantly,” said Joel Zaldivar, who started his family’s home search in an attempt to move from the Charlotte area to the Piedmont Triad.
The market was so competitive, Joel and his wife, Fayla, started putting in bids without putting their eyes on the houses.
“The first property, we put in an offer $20-25,000 over asking price, sight unseen. The second one, sight unseen,” Fayla said.
The pair placed so many bids on homes they couldn’t count them on one hand.
“It was insane. ‘We were putting in offers on houses we didn’t even want,’” they added.
According to Kelly Marks, president of the North Carolina Realtors Association, it takes about six months’ worth of supply to have even real estate buying and selling conditions.
As of last month, he said, the country was working with about a quarter of that.
“This is not a bubble,” Marks said. “This is supply and demand.”
With inventory so depleted, each time the Zaldivars placed a bid, it was a battle.
“You used to like, want to come in under budget, asking so many thousand dollars off, and all these stipulations. ‘You can’t do that now.’ You can’t do it. Like at all,” they said.
“I feel very badly for the buyers because I hear from all over the state that you’ve got people who are 0-3, 0-5, 0-8 with offers,” Marks said.
Marks says this all started about 10 years ago, not as a result of the pandemic.
“The real estate investment trusts who invest in office buildings, commercial properties, strip centers, started turning their attention in 2011 when real estate, residential real estate was relatively inexpensive,” he detailed.
Marks continued to explain many of the trusts expected to retain the residential real estate for about five years before selling it off. Then rent increased at such a high rate they decided to hang on to the properties. Across the country, he said, the market is about 5.5 million homes short of what’s needed to meet the demand, adding the trusts own more than 7.4 million homes.
“And right now there is no additional inventory that’s going online,” Marks said.
Eventually, the Zaldivars prevailed, finding a home in Kernersville. However, the people they bought the home from couldn’t move out until the middle of August, so they did a lease-back, allowing the previous owners to stay in the home while the Zaldivars got a rental for the time being.
“This is crazy, compared to, like to before it was, you find a home, you put an offer on the home, they accept it,” they said.
Still, the Zaldivars admit they wouldn’t have been successful in their search had it not been for financial help from their family.
“Between her mother and my mother, we got into this house, I mean we were blessed in that aspect,” Joel detailed.
That blessing, Joel says, is widening the gap between people who can and can’t afford to buy.
“There’s a certain class of people who are now going to be elevated and there’s a certain class of people that are now forced to be renters,” he said.
Marks does see a way out. In the short term, he said, it starts with tax policies.
“If you could get the real estate investment trusts to release the affordable housing category back into the marketplace, that could be immediate and that could be driven by tax policies,” he said.
In the long term, Marks sees a potential fix in state and local zoning and density policies.
“Just remember it’s more important to win the war than it is the battle,” he said, of prospective buyers. “Eventually they’re going to get their home.”
As of last month, there were fewer than 220 single-family homes on the market in Greensboro, including pre-construction. According to Zillow, North Carolina home values have gone up 17.4% over the past year.
“We’ve had areas, and pockets, and neighborhoods that have been driven up over 20%,” Marks added.
Marks says the areas seeing the greatest demand in Guilford County are zip codes 27410, 27408 and 27455.