Epstein and Bixby, nevertheless, managed to purchase a house in Cleveland Park by asking their real estate agent, Marjorie Dick Stuart, to try another strategy: wooing people whose homes they like but that aren’t for sale.
“The only reason we were able to get this place is that Marjorie found it for us before it went on the market,” Epstein says. “If we had waited, then there would have been multiple bids.”
Inventories in the Washington area are even tighter than they were a year ago. As a result, real estate agents say, they are stepping up efforts to find pre-sellers — people who are on the verge of listing and people who perhaps hadn’t considered listing but might be persuaded to do so with the right offer.
According to RealEstate Business Intelligence (RBI), a Rockville-based real estate data firm owned by MRIS, active listings in the Washington metropolitan area declined about 40 percent from January 2012 to January 2013.
In January 2013, 6,049 homes were listed for sale in the region, down from 10,095 a year before. Many of the houses that hit the market were snapped up quickly, another indicator of low inventory. From January to January, the average number of days on the market dropped by about 27 percent — to 63 days from 86 days.
The number of new listings in January dropped 4 percent, to 4,004, the lowest for that month in 16 years.
Soaring demand this year is expected to exacerbate the problem, according to Lisa A. Sturtevant, deputy director of the Center for Regional Analysis at George Mason University. The center projects that 42,000 new jobs will be created in the region this year, up from 36,000 last year.
Many of the new jobs, Sturtevant said, will be filled by people moving into the area who need homes.
Another reason for the lack of homes for sale is too many homeowners owe more than their property is worth. “Those homeowners can’t generate enough profit, especially after they pay the transaction costs of selling, for them to make a down payment on another property,” says John L. Heithaus, chief marketing officer of MRIS. “The only thing that will help these homeowners is for prices to rise faster.”
Finding potential sellers
The challenge for desperate buyers is to identify potential sellers who have stayed on the sidelines.
To find them, real estate agents scour public records and online discussion boards, knock on doors and send letters on behalf of their clients to homeowners to see if they might be thinking of selling.
Gerry Dunn, an associate broker with Real Living/At Home in D.C., says this process is easiest in a condo building, where he can quickly identify all the two-bedroom units of a particular size and send a postcard to those owners describing his client’s interest in buying.