Michael Mita is the broker and owner of RE/MAX Flagship in Narragansett, where he oversees a three-person team. He spoke recently with Providence Business News about recent trends in the residential real estate industry.
PBN: What impact has the prospect of increasing interest rates had on residential sales? Do you anticipate more frequent increases in 2018 given concern over inflation?
MITA: Everyone seems to agree the rates will continue to go up through the year. For some people, that may affect their timeline. They may fear their buying power is going to erode as the rates go up and may make a purchase more quickly. For most people, who are buying for family and life reasons, the timing is really a function of those main reasons.
PBN: In terms of the new tax code, has that had any impact on homebuying?
MITA: I don’t think we’ve seen the effects of it yet. If it affects the market positively, and people’s wealth goes up, they’re going to be more confident in buying a home. If take-home pay goes up, they’re going to be more confident in buying a home.
PBN: Low inventory has been the story all year. Is there anything that can change that short of more inventory being built?
MITA: The short answer is no. It’s a slow process. We have a perfect storm here of pent-up demand. We are setting records for demand, the actual transactions. More people have bought in the last two years than ever before. As long as that pace of demand keeps up, I don’t think anything can significantly affect the inventory. The price goes up because there is more demand, less supply.
PBN: On the issue of buying, how do people avoid being drawn into a bidding war, especially for the starter homes?
MITA: Do you want to avoid the war, or do you want to win the war? One way to win the war is to have no opponents. The only way to achieve that is to have a great agent who is on top of the inventory and may get you into a home before anyone else. … Your best move really is to win a war, now.
PBN: The days-on-market statistic has been decreasing all year. Do people now have to move very fast if they want to buy, walk in with all the pre-approvals and be ready to make a decision?
MITA: Absolutely. The more you can have prepared upfront, the more quickly you can move, the more likely you are to win that war. The more you can be prepared to make a credible offer quickly, the better you are.
Mary MacDonald is a staff writer for the PBN. Contact her at firstname.lastname@example.org.