Why low inventory doesn't mean buyers are desperate

The inventory level in Park City has fallen below 300.... last year it was over 800. Yet I'm sitting on a listing that I've had with a colleague for 3 months. The sellers wouldn't agree to a price drop until nearly 90 days in, and we just got our first offer.

"But the inventory level is so low," the seller says.

"Yes, but that doesn't mean buyers are desperate, nor willing to overpay after seeing this home sitting for 90 days."

So what's really happening:

1) A large reason for the lack of inventory is that people literally don't have anywhere to move. In a market like Park City where people have second homes, it's not a matter of keeping a roof over their head, but if people have to do a 1031 exchange and can't find another property then they are undoubtedly not able to sell, even if the price is attractive.

2) Where there is still land available, many are choosing to park their money and buy the dirt, but the cost of actually building the house has increased so much, and the wait time to get the goods has also increased, so for many it doesn't make sense to buy now. However, after recently selling a home in Promontory, one of the elite communities in Park City, many buyers came in saying that they had purchased land in the development but no longer wanted to build. The home I was showing was just under $9mil! So if you have a good builder who can do the job quickly I suggest you jump on it!

3) My mom recently asked me "how do people have so much money?" A friend of mine told me he had $60K in debt before the pandemic and now only has $6K. Think of all the meals, vacations, gifts, etc, that you didn't buy over the course of a year. That's a lot of money, and if the buyer put any of that money into the stock market then they undoubtedly have a lot more money today!

So, there's a bit of reasoning for you. If you have any questions about buying in Park City, New York City, or need a connection for a realtor anywhere else in the world please let me connect you to one of my business partners.