LACK OF LISTINGS SLOWING DOWN THE
HOUSING MARKET
The housing crisis is finally in the rearview mirror as the real estate market moves down the
road to a complete recovery. Home values are up. Home sales are up. Distressed sales
(foreclosures and short sales) have fallen dramatically. This will be the year that the housing
market again races forward.
However, there is one thing that may cause the industry to tap the brakes: a lack of housing
inventory. While buyer demand looks like it will remain strong throughout the summer, supply
is not keeping up. Here are the thoughts of a few industry experts on the subject:
David Crowe, Chief Economist for the National Association of Home Builders:
“Many sellers may not have an absolute decision as to whether to buy an existing home or a new home. So
the low inventory of existing homes is locking them in place.”
Ralph McLaughlin, Chief Economist with Trulia:
“We are in a time of short supply, which is great news for sellers because they will likely be faced with
multiple offers due to the little inventory out there…Buyers will be up against a lot of other people and
against a short supply of existing homes.”
Fitch Ratings:
“One important issue that has restrained sales and starts is inventory. On an absolute basis, inventory has
not expanded as much as in past recoveries, leading to less selection for buyers. This is especially true for
existing home sales but is evident for new home construction as well. When it comes to U.S. housing
inventory, more is better.”
Lawrence Yun, Chief Economist at NAR:
“First-time buyers in high demand areas continue to encounter instances where their offer is trumped by
cash buyers and investors. Without a much-needed boost in new and existing-homes for sale in their price
range, their path to homeownership will remain an uphill climb.”
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