When Sandy Maline, a broker with Advantage in Real Estate, was aiding home buyers in the process six, seven years ago, the pace could very well be described as normal.
Maline walked clients through $200,000 starter homes in Avon Lake and Fairview Park, which sold for no more than $10,000 over asking price. “We did that,” she says. “We were good.”
These days, in the worst real estate market since the Great Recession, Maline is repeatedly flabbergasted.
“I just had a house list and sell in two days,” Maline says, adding that 48 clients went through the house. “I mean, it’s nuts. I myself don’t even understand it.”
Maline’s grievances are the new normal. Just as cash-wielding owners and out-of-state investors have led to a barren Multiple Listing Service, the resulting desperation to own a home has pushed buyers to fierce tactics, including waiving inspections, writing appraisal gaps and entertaining buys off-market. Moreover, Wall Street has been gobbling up homes — up to 30% in Atlanta and Charlotte, North Carolina — and the U.S. is short some 4 million homes, according to HUD data.
“It’s a housing issue and it’s an inventory issue,” says Mark Vittardi, of the Akron Cleveland Association of Realtors.
And Cleveland isn’t immune. A February 2021 analysis of the Cuyahoga County market during COVID-19 by Frank Ford, senior policy adviser at the Western Reserve Land Conservancy, showed that, in October 2020, active home listings were down 49% from the year previous.
Along with reduced inventory comes soaring prices.
In Ohio City, median sales prices spiked by nearly $40,000 to $217,250. In Lakewood, from $185,000 to $215,000. In Valley View, the 2019 median was $201,000. One year later, it was $280,000.
Vittardi sees the inflationary rate hikes as an undeniable byproduct of out-of-state buyers — both capitalist investors in Los Angeles and coastal elites returning to the Midwest. Many, he says, are strong-arming with cash, no-contingency offers that less-aggressive buyers simply can’t spar with.
“Buyers have to be nimble,” Vittardi says. “They have to be prepared. And they have to be educated.”
In interviews with a half dozen agents hip to markets from the $950,000 mansions of Avon Lake to the $250,000 bungalows in Akron, most advised contenders in today’s arena to develop a specific strategy before entering it.
Maline, for one, recommends buyers use what’s called an escalation clause, a method to compete with cash offers by offering to pay, say, $1,000 or $2,000 above the highest bid — up to a certain ceiling. And besides the obvious dictum of getting properly pre-approved, she urges buyers to go quick in “with a really good, strong offer, high above asking.
“Sometimes the seller just says, ‘I don’t want to take any more, I don’t want any more people in my house,” Maline says. “Could you imagine if you had 48 people walking through your house in two days?”
But being quick could lead to buyer’s remorse. David Sharkey, an agent with Progressive Urban Real Estate, advises mastering the art of the speed read.
“Look for sloppiness, painted outlets, drywall mud gunked up around the switches,” he says. “Are the windows filthy? Are the blinds broken? I mean, you can see if somebody just slapped some things together.”
Still, these are hellish times for buyers. Many of Howard Hanna agent Jaclyn Gannon’s clients have waited eight months to a year, placing bids well over asking, depleting savings to drop a 5 or 10% down payment. (And still losing.)
Just recently, a four-bedroom home in Avon Lake went on the market at 2 p.m. on a Thursday. By the weekend, there had been 23 showings.
“And out of those 23 people, only one person is going to get the house,” she says, noting that she received two offers on her phone during our brief interview. “And it’s listed for $615,000! Will it go for $654,000? That wouldn’t surprise me."
And things just keep getting stranger. “I’ve actually had someone tell me that a Realtor told them to go through a back window to check out a house," Maline says. “I’m serious!” she adds. “People are that desperate for housing.”