3/18/2023 0 Comments Low home inventoryBut you shouldn’t put your plans on hold because you’re waiting for those additional houses to hit the market. If you see a home you like, you want to jump on it right away.”īasically, inventory is still low, even though more homes are coming. For buyers, the market is likely to continue to move fast. But that means we’re looking at inventory levels of roughly half of what we saw before the pandemic. “ We expect that we’ll start to see a turnaround and inventory will stabilize and start to go up a little bit in 2022. Danielle Hale, Chief Economist at, shares this hope, but offers perspective: Experts are projecting more homes will soon become available thanks to sellers re-entering the market. But what if there just aren’t that many homes to choose from? You want to find the home of your dreams, and you don’t want to settle. This meant there were about 177,000 fewer homes listed in what’s already typically a slower month due to the holidays andĬolder weather.” What Does All of This Mean for You?įor a buyer, low inventory can be a challenge. “ Last month, the number of home listings dropped 26.8% compared with the same time a year earlier. The result? The number of homes available for sale dropped even further. At the same time, sellers hesitated to put their houses on the market as concerns about the pandemic mounted. So, as mortgage rates dropped to at or below 3%, buyers eagerly entered the market looking to capitalize on those low rates to secure a home that would fulfill their changing needs. Having a safe space to live, work, school, and exercise became even more important for Americans throughout the country. Then, when the pandemic hit, it fueled a renewed appreciation and focus on the meaning of home. The Pandemic’s Impact on the Housing Market That underbuilding left us with a multi-year inventory deficit going into the pandemic.Ģ. For the last 13 straight years, builders haven’t been able to construct enough homes to meet the historical average ( as illustrated in green on the graph). Since then, the level of new home construction has fallen off. That was one of the factors that led to the housing crash back in 2008. The result was an oversupply of homes on the market, so home values declined. Builders exceeded that average during the housing bubble ( shown in red on the graph). The graph below shows new home construction for single-family homes over the past five decades, including the long-term average for housing units completed. New Home Construction Fell Behind for Several Years Here’s a look at two reasons why today’s housing supply is low and what that means for you. While low inventory in the housing market isn’t new, it’s a challenge that continues to grow over time. The number of buyers searching for a home greatly outweighs how many homes are available for sale. One key question that’s top of mind for homebuyers this year is: why is it so hard to find a house to buy? The truth is, we’re in the ultimate sellers’ market, so real estate is ultra-competitive for buyers right now.
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