Stunned Home Buyers Find the Bidding Wars Are Back

As the spring home-buying season kicks off, buyers increasingly are finding that a drop in inventory has sparked bidding wars. All 28 markets tracked by the Wall Street Journal saw steep drops in inventory during the first quarter, and supply plunged to 6.3 months in March from 11.1 months in 2008. Inventory is even lower in some markets, at just 1.5 months in Sacramento, Calif., 2.4 months in Phoenix, 3.4 months in both San Francisco and the District of Columbia, and 4.1 months in Miami. Housing supply has fallen because sellers are holding out for higher prices, investors are snapping up properties with cash, and Fannie Mae and Freddie Mac have yet to put on the market hundreds of thousands of foreclosed homes that they own. Despite the increase in bidding wars, experts say buyers remain focused on affordability; therefore, sellers are not coming away with huge profits. | Read More