Going fast: Strong demand has melted away inventory in some housing markets (© David Sacks/Getty Images)

© David Sacks/Getty Images

Prices may not be shooting up, but homes are once again selling at a rapid clip in many markets, draining multiple-listing services and turning up the competitive pressure on buyers. Yep, that's right: Multiple offers are back.

In this installment of Buying Advice, we'll check in on these tight housing markets at the start of the spring selling season. (You can see the 10 tightest major housing markets around the country in this slide show.)

We'll also round up the latest national housing statistics and answer a reader's question on whether it's prudent to rent out the home he can no longer afford and try to get a mortgage for a more affordable smaller house.

(For next month's column: Buyers, has a low appraisal kept you from purchasing a home? Have you lost a home to an all-cash investor this season? Please share your experiences with us at msnrealestate@microsoft.com.)

Dude, where's my house?
In markets such as Portland, Ore.; Memphis, Tenn.; Seattle; and Salt Lake City, listings are practically evaporating as they come on the market.  

 "There's not an awful lot out there for sale," says Niels Brownlow, a broker with Coldwell Banker Barbara Sue Seal in Portland — especially, he says, on the lower end, as investors and first-time buyers vie for bargains.

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"'If (a buyer) is not there the first day a home comes on the market, it's gone," Brownlow says. Indeed, Brownlow says he recently had someone make an offer on a condo in Portland's downtown area without even seeing it.

Portland's neighbor to the north, Seattle, is also getting highly competitive, as 36% of the inventory has melted off the market, according to data from Realtor.com. (Realtor.com is an MSN Real Estate partner.)

"I'm seeing multiple offers on just about every one of my listings," says Jed Kliman, with Windermere Realty. 

The competitive environment has already begun to nudge prices up in some coveted Seattle neighborhoods such as Ballard and Queen Anne.

Indeed, a lot of what's left for buyers in hot markets such as Salt Lake City is "junk parts," says Dave Winters of Re/Max Associates. "When a quality property that is priced accurately comes out on the market, it's not going to sit around."

Bargain prices and historically low interest rates are bringing buyers back. The belief among buyers, agents say, is that the housing market has already turned the corner and that there won't be a better time to land an affordable home.

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However, a lot of potential sellers still can't list their homes at today's prices because they are underwater on their mortgages, says Mark Fleming, chief economist for property analytics firm CoreLogic. That has kept supply in check. Moreover, the flow of foreclosures and other distressed properties onto the market has slowed considerably after the robo-signing controversy and as loan-modification and rental programs have been expanded. As a result, buyers are fighting over those decent properties that are left. In some cases, they are even competing with foreign buyers who see cheap U.S. real estate as a once-in-a-lifetime rental investment.

"We are seeing buyers from New Zealand, Switzerland and from the U.K. here," says Rita Driver, an agent in Memphis. "I'm winding up with more multiple offers now than I have in the last five years."

Just how long this scarcity will last is anyone's guess. Already, Winters says, he is picking up more listings in Salt Lake City from sellers looking to capitalize on the shortage.

This scarcity — and rising prices in half of the markets that Fleming's firm studies — should urge banks and other sellers to list more properties in coming months as the selling season and temperatures heat up. "This will bring people off the sidelines," Fleming says.