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The first home was in Midvale, Utah, a three-bedroom apartment of just over 2,100 square feet, priced at $ 479,000. Rob Ettaro and his girlfriend, Kaliana Veros, who had moved from western New York to Salt Lake City, attracted by the career opportunities and breathtaking scenery of the Wasatch Channel, decided to make an offer.
It was winter, when the young couple had a modest wish list that included room for family to visit. Their hearts were still beating at the thought of owning property. Ettaro and Veros offered $ 6,000 more than asking price. The house sold for an additional $ 60,000.
Delighted, on the next house, they offered $ 60,000 on top of the list and waived the inspection. There were 54 offers. They weren’t even close.
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On it came through the spring, their growing frustration said in numbers: 70 house visits; 14 offers made; not one accepted.
“Here’s another one,” Ettaro said, reading the detailed spreadsheet he is holding. “We made $ 35,000 above demand, and they ghosted us. No repairs. As if. They just never got back to us.
Finally, after five months, Ettaro, 30, and Veros, 26, had had enough; they stopped looking. “Just the mental energy that we were spending seeing these houses and trying to imagine ourselves in them and it just wasn’t working over and over again,” Veros said.
Ettaro added, “We are literally giving them everything we can, and it’s still not enough. We felt really exhausted.
Mortgage rates may be historically low, but so are buyer morale these days. Last month, the Fannie Mae Home Purchase Sentiment Index showed that 64% of people think now is a bad time to buy, up from 56% the month before. Stratospheric prices, brutal bidding wars and record high inventories have conspired to make many potential buyers frustrated and tired.
And some are canceling their research, for reasons ranging from an inability to compete financially, to a reluctance to forgo contingencies like an inspection, to a belief that the market will cool down over time. Home sales have fallen for four consecutive months, even as prices hit record highs.
Mark Boyland, real estate agent at Keller Williams in Bedford, New York, notes “some buyer fatigue,” he said. “If you’ve lost four or five multiple offer situations, you say, ‘Maybe we should wait until things calm down.’ “
A real estate market like the current one can be a boon for sellers, but it is emotionally draining for potential buyers. “Every time you make an offer for a house, you have actually fallen in love,” Boyland said. “And now you’re heartbroken, over and over again. “
Thomas Brown is co-founder of Agency Texas, a brokerage firm serving San Antonio, Houston and the greater Austin area, where home prices rose 43.9% year-over-year in April. , the biggest jump among the country’s 85 largest metros, according to a Redfin report. Unsurprisingly, “there are a lot of people who are suspending their research right now,” Brown said. “The market is starting to stabilize. Don’t standardize. Stabilize.”
This stabilization is happening, according to Brown, because “there will just be fewer buyers.” The Austin rental market is heating up for the same reason. “People say, ‘I can’t buy the house. I will rent for a year.
Greg and Daphne Decoteau rent in Boise, Idaho, but not by choice. In 2019, the couple, empty nesters in their 60s, moved from Napa Valley, California to Boise to live out their retirement years, drawn by lower living costs and an active lifestyle. Acting with caution, they toured the area through the four seasons before moving and renting before committing to buying a home.
Then the pandemic struck, diverting their attention from house hunting. By the time the Decoteaus started looking again last December, the already hot local market had taken off like a rocket. They waited and watched, “expecting a bit of sanity to creep in,” as Greg Decoteau said.
Instead, he said, “it just got worse and worse and worse and worse. Now it’s to the point of absurdity. A year ago, a $ 400,000 house sold for $ 650,000.
A retired tech vendor, Greg Decoteau had a university degree in real estate and his wife is a former broker. They consider themselves financially astute. They bought and sold several houses during their marriage. Finding themselves in limbo, they are now reduced to living in a 1,000 square foot rental with most of their belongings in storage. They too have stopped looking.
“Frankly, we don’t have the resources to play this game,” said Greg Decoteau. “We are past our best earning years. It is less a question of appetite than our financial reality. I wake up every morning and strike myself for not seeing this coming.
But how could we have predicted the irrationality of this real estate market? Candice Smith, a Redfin agent who covers Westchester and Rockland counties in upstate New York, is still working with buyers who started looking in February. “This market, you’re going to be in it for the long haul,” Smith said. “The average person would be tired if you put in 15, 20 bids and were outbid by the competition. “
Even under normal conditions, the buyer-broker relationship has aspects of a therapy session, with buyers projecting their hopes and dreams onto a home and agents trying to translate and temper those desires. These feelings only become exacerbated when large sums of money are at stake. But brokers go the extra mile these days as buyers see their hopes dashed and lose confidence.
“After every loss you have to keep cheering them on,” Smith said. “I have a buyer right now who said he was going to take a break. I advised them to remove the emotion from it. What I’m doing is rethinking. I walk them through the process of why they lost, talking about the valuation strategy.
Jennifer Louis, an agent in Boise who has worked with the Decoteaus, said she makes sure her buyers understand what it takes to find a home in a “Hunger Games” environment. And what does it take?
“You have to make a decision literally sometimes in an hour,” Louis said. “Sometimes not even. There is a line in front of the door. You have 15 minutes to view the house and make a decision.
“I need people who are responsive and available. I’ve had others where they haven’t answered me for a day or two. Well, here we go. You have to take time off from work. You have to fly into town or do whatever it takes.
For any buyer who is serious about competing, finding a home has become a consuming second job. This level of engagement, often unrewarded, also leads to buyer burnout.
Ettaro and Veros saw between five and 10 homes a week, spent hours scanning online ads, and made a living off take-out as they drove to open houses in more remote areas they hoped to better afford. Instead of hiking or mountain biking on the weekends, activities they both love to do, they would visit homes they were almost guaranteed not to have and argue.
“We were arguing about whether, ‘Hey, do you want to check out five houses today?’ ”Ettaro said.
“We came to the conclusion that it clearly affects us. We have to take a step back and relax for a minute and see how things go, ”Veros said.
Faced with such fierce competition, buyers tend to fall into two camps: those who become defiant and determined to secure a home, and those, like Nick Sauro, who prefer to get out of the mania.
Sauro, 41, and his wife, Ilone, 39, own a starting home in New Rochelle, New York, where they live with their 18-month-old twins, 8-year-old daughter and mother Ilone Sauro. They desperately need more space. They have a budget of $ 750,000 to upgrade. But when they started looking this spring, “there was just nothing there,” Nick Sauro said.
“Every house we loved was this crazy bidding war,” he said. “So these other houses just aren’t great. They need a lot of work. You go out. You are a little disgusted. We cannot switch to a renovator. And that’s all there is there.
As summer arrived, the Sauros decided to take advantage of the good weather. Their current home may be cramped, but they own it and buying it eight years ago was stress-free. “If you went through the process,” Nick Sauro said, “why would you want to participate in this madness? “
For first-time buyers, however, it can seem like they’ll never get past the frenzy and become homeowners. And in markets where prices have risen 25% or more in a few months, a sense of hopelessness is not an overreaction to losing a few bidding wars.
“For young people, it’s heartbreaking, because if they don’t already have a house or a family that will finance them, it becomes almost impossible to find them a house,” said Louis, Boise’s agent.
Ettaro and Veros made the decision to continue renting in Salt Lake City, wait and hope that they can eventually buy. “Maybe it’ll stabilize,” Ettaro said. “Maybe we won’t have to go over $ 70,000 by asking and being beaten by 50 more offers. “
The Decoteaus, too, at a different stage in their life but facing the same dilemma, sit on the sidelines, feeling less burnt than just burnt.
“We’re sitting here trying to figure out what we’re going to do,” said Greg Decoteau. “We’re not sure we can stay here. We’re pretty much overpriced.
On their list of places to retreat, the Decoteaus also included Asheville, North Carolina; Medford, Oregon; and Colorado Springs, Colorado. Maybe one of these communities is still affordable?
“My suspicion is that these places are sucked in by this madness as well,” said Greg Decoteau. “Our other option is to stay in this little apartment until we go crazy.”
© 2021 The New York Times Company
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