Supply will not rise as fast as demand
It is a common theme today, not enough inventory. I cannot speak for the rest of the country but it seems to ring true locally here in Temecula. Regardless of what you hear on the news about everybody leaving California, it’s just not the case in this area. California is a big state and yes I am sure there are areas of California that people are leaving in droves.
In regards to Temecula and its amazing weather, amenities, opportunity, home prices and overall quality of life, people are wanting to live here, plain and simple. We have one new large housing tract called Somers Bend. Other than that? You’re going to be buying existing homes.
We have been selling real estate for years and new home communities were always & easy option, with some great incentives from the builder. This simply hasn’t been the case over the past few years. Incentives are becoming more scarce and depending on what phase your home is going to be built in, prices are rising dramatically.
A great example was this year. We were showing new home builds in Corona. They were scheduled to start on their home build at Phase 3. Both Phase 1 and 2 were sold out and phase 3 was expected to rise in price by $20,000 to $30,000. For the same house, 3 months later builders were able to get a substantially higher price.
Frustration for Buyers
I wanted to talk about frustration as a hole for buyers moving forward into Buying a home in Temecula in 2021. Some of the things that are going to carry over from 2020 and you need to be aware of are as follows.
- Be ready to over-bid on properties and release your appraisal contingency. What does this mean? If you put an offer on a home at $520,000 but it only appraises for 500,000, you, the buyer, are responsible for that $20,000. This will come straight out of your pocket in addition to your down payment and closing costs.
- It can become demoralizing, over bidding on properties on multiple occasions and never getting something accepted. I always tell buyers over the years, it always seems to work out, just don’t give up and we promise you will find the perfect home.
- You need an aggressive realtor that’s not going to tell you what you want to hear but the truth. If you want an offer accepted you will have to give up some things that are common in a normal Market. Termite report clearance, home warranties, repairs are all things that buyers in many cases need to wave in today’s market. Sugar coating things in this market is not going to help you get in a home. When you find an agent to represent you in this market they should pretty much come straight out and ask you, are you ready to go to war? Of course, we might be exaggerating a little bit but not really haha.