It's a Seller's Market in Rochester and Rochester Hills

It was a hand-painted Dr. Seuss room that helped seal the deal on Heather and Deric Wilkins' new home in Rochester Hills. The home, in Hunter's Creek, was on the market only three days last fall.

The Wilkinses had been house-hunting for six months; they had already bid on - and lost - four other houses. In the end, they got personal with the Hunter's Creek sellers. 

"I wrote in a letter how much we liked the hand-painted Dr. Seuss room," said Heather Wilkins. "Turns out the seller did it and was afraid someone would paint over it right away."

All across Rochester and Rochester Hills, home-buyers, sellers and real estate professionals are telling similar stories: stories of record-low inventory and never-ending demand — demand that requires buyers to be ready with an offer at a moment's notice. (Read a collection of these stories in 'House After House Had Slipped Away' on Patch.)

This has been the state of real estate in the two cities for the past year.

"There's no such thing as strolling through open houses on a weekend and then going home to think about the homes you just saw," said Jeremy Watters, an agent with Max Brook who sells homes in Rochester, Rochester Hills and the surrounding area. 

"The inventory is down 26 percent; the interest rates are at historic lows," Watters said. "Historically, these are the slow months for homes to sell.

"But we've been going nonstop."

What's for sale?

According to a report released Wednesday by the S&P/Case-Shiller Home Price Indices, Detroit is one of few metro areas where the average home prices remain below January 2000 levels — even though it posted its biggest year-over-year increase (13.6 percent) from 2011 to 2012.

But in Rochester and Rochester Hills, at least, that finding is quickly being rewritten.

"You can look behind us and see the bottom of the market," said Drew Colburn, an agent with Colburn, McDonald and Associates, based in downtown Rochester.

Colburn shared the following Rochester and Rochester Hills real estate data:

• As of Thursday afternoon there were 101 homes for sale in Rochester and Rochester Hills, ranging from $46,500 to $1.2 million.
• 63 of the homes were less than $500,000
• So far in 2013, 81 homes have been sold and 121 home sales are considered "pending."

Colburn closed on a home in Rochester Hills on Thursday that received 15 offers in three days.

"If a house is still on the market after a week or two, it's either overpriced or there's a problem with the house," he said, adding that the most common problems would be the floor plan or a short sale situation.

(Agents and sellers: tell us about your best Rochester-area home for sale here; we'll showcase the homes this week on Patch.)

Get ready to compete

Andrea Lewis grew up in Rochester Hills and was looking to move back. She and her husband, Ryan, were living in Shelby Township but drawn back to the Rochester area because of its residential feel and vibrant downtown. 

They finally closed on a house near Livernois and South Boulevard two weeks ago; the Lewises were one of 42 potential buyers to walk through the home in two days. They paid $5,000 over the asking price. 

"I couldn't believe how competitive the market was," Andrea Lewis said. 

Because of the competition, agents say it's important to work with someone who knows all of the keys to writing a good offer - and price is just one piece of it.

"A strong offer consists not only of a fair offer price, but also fair language in terms of concessions asked, and language in regards to appraisals," said Amy Chermside, an agent with Coldwell Banker Weir Manuel in Rochester.

Chermside said that if she knows a buyer is looking to buy in a particular area, she will call homeowners in that neighborhood to see if they are thinking of listing their home.

Watters, the Max Brook agent, has done the same.

"I've gone door-to-door before when I'm with a client who wants to live in a particular subdivision," he said.

All three agents agreed the scarcity of homes in the Rochester and Rochester Hills area will continue in 2013. 

Home prices are still far from an all-time high — Colburn said that number is about $200 per square foot. But they are reaching a level that more closely mirrors where the local economy was six or seven years ago. "I think we could get there late this year, but definitely by next spring," he said.

Resources

For buyers: Find a Rochester or Rochester Hills agent in the Patch directory.

For sellers: We're looking to regularly showcase area homes for sale; if you're an agent or seller, tell us about your best Rochester-area home for sale here; we'll showcase the homes this week on Patch.)

For readers: Have a home-buying or home-selling story to share? Tell us in the comments.