In tight housing market, seller's dream is buyer's nightmare
FARGO -- It happened fast.
On a Thursday night in March, Liza Gion brought a real estate agent over to her house in north Fargo on a whim -- just to check it out.
An hour later, another agent called about an interested client. The house was a mess, but Gion and her husband had a showing Friday.
It sold that Sunday.
Gion's tale has become the norm in the Fargo-Moorhead area, where the indicators of a booming real estate market are big and small, and they're everywhere.
A steady rise in home values, and an explosion of newly constructed homes that has yet to soothe demand. Pressure on a buyer to make an offer within hours -- if not minutes -- of a showing, lest the next visitor snatch it up. Dozens of residents looking to move who look at the state of the market and think 'Even I can sell a house right now.' And a Post-it note stuck to the door of an occupied home: "Would you consider selling? If so, give us a call."
The average American home stays on the market for 81 days, according to Realtor.com. In the Red River Valley, few homes last a week, said Kevin Fisher, a real estate agent and president of the F-M Area Association of Realtors.
It's a seller's dream come true, but the hot real estate market here can be a nightmare for someone looking to buy a home.
"If you're not constantly on top of what's coming on the market, you're probably not going to get a shot at it," said Aaron Greterman, a realtor for RE/MAX Legacy.
On their own
After watching a neighbor's house snapped up within hours and another sold without a real estate agent, Jana Wiecks and her husband decided to skip "the middleman" and list their townhouse in southwestern Fargo on their own.
"One of the reasons that we decided to sell right now is because the market is so hot. Things just aren't staying out there," Wiecks said.
A week after posting ads on Craigslist and the real estate website Zillow.com, Wiecks said they've fielded several calls and done a handful of showings. There are about 125 area homes currently listed for sale by the owner on Zillow.com.
Steven Zimmer doesn't know much about real estate -- "just enough to be dangerous," he said. But he also cited the speed of the market as huge factor in his decision to sell on his own his four-bedroom house in West Fargo.
"The market right now is crazy. Literally," said Zimmer, a senior city planner for the City of West Fargo.
'Make a decision right away'
The Wiecks debated for months whether they should buy an existing house or have a new one built.
The headaches of being a buyer in the region's hot real estate market helped the couple make up their minds to build in Woodhaven -- by the time they set up a showing for a house, it was gone.
"We weren't even getting a chance to look at them," she said.
That pace has been driven in part by the "pocket listing" -- when a real estate agent sells a house to their own client, or another within the company, rather than listing it for the public to see on the Multiple Listing Service. That's often how homes are sold before officially hitting the market, Greterman said.
In the past, pocket listings had been used to sell more expensive homes, Greterman said. But they've become more popular in real estate markets where housing is scarce, such as in the Red River Valley.
Barbara Grande mentioned in passing to a fellow real estate agent that she and her husband, Mike, were thinking about downsizing from their house in south Moorhead. Just thinking.
But the agent followed up and scheduled a showing for a client, who made an offer on the spot.
The area's low housing inventory has pressured prospective buyers to make an offer as soon as possible, said Grande, a managing broker Coldwell Banker First Realty. The days of weighing pros and cons of different houses at the kitchen table are over, at least for now.
"The buying experience is not as much fun," Grande said. "Buyers have to be in a position to make a decision right away."
'Knocking on doors and calling people'
Demand also has driven a boom in new house construction. Almost 950 new homes were built in 2012, according to the Home Builders Association of Fargo-Moorhead - up from 612 in 2011. Association President Darrick Guthmiller said he expects an equally strong year in 2013.
But it's not enough.
The scarcity of houses on the market also means real estate agents are constantly looking to bring more houses into the fold - whether or not a homeowner is looking to sell.
Agents are "knocking on doors and calling people in different neighborhoods" where a client is looking to settle, Grande said.
That's been common practice in good times and bad, she said. Now, it's driven by necessity.
Sasha Holmes, a closing agent with FM Title, said her office recently helped close a sale on a house for a couple who hadn't thought of moving until they came home to a note on the door asking if they'd think about selling.
"We have to find inventory for our buyers. There are so many," Grande said.