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August 28, 2016

Overcrowded Open Houses Draw Police

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Overcrowded Open Houses Draw Police

Open houses in some markets are drawing such large crowds that police are being forced to shut them down, CNBC reports.

The Rush Is On: Buyers Willing to Camp Out to Snag a Home

A recent open house in Belmont, a suburb of Boston, drew more than 100 people within 45 minutes. The crowds blocked the  streets, which prompted neighbors to call the police to close the open house.

"We got shut down!" Catherine Luther, a real estate professional with Channing Real Estate, told CNBC. "I’ve been in this business for 30 years, and it’s never happened before."

Luther hired an off-duty police officer to direct traffic for an open house the next day at the same property. That open house drew more than 150 cars. Shortly after the weekend, the home was under contract with more than a dozen bids.

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"We really need more inventory," Luther told CNBC. "Prices are going up, and we just don't have enough property to sell."

A similar incident was reported at an open house in Seattle, which drew more than 100 potential buyers. In the Phoenix area, more than a dozen people camped out for days for the chance to buy one of the 30 homes in a new community, which were priced in the low $200,000s. 

Sparking the buyer rush is the lack of inventory in many markets. In January, a 4.7-month supply of homes were up for sale, a very limited supply heading into the spring-selling season, according to the National Association of REALTORS® housing data. A six-month supply is considered by most economists' accounts to be a more balanced market. 

Buyer demand is increasing, boosted by improving employment and high rents that are pushing more people into home ownership. "We're afraid that interest rates are going to creep up, and inventory is down, so there's more of a fear of loss right now in the market and people are coming out," Maria Rini, a real estate professional with RE/MAX in Bergen County, N.J., told CNBC.

Source: "Call the Cops! This House Is for Sale … Huh?" CNBC (March 13, 2015)