An important factor in today’s market is the number of homes
for sale. While inventory levels continue to sit near historic lows, there are
indications we may have hit the lowest point we’ll see. Odeta Kushi, Deputy
Chief Economist at First American, recently said of our supply challenges:
“It looks like inventory may have hit a bottom
(we’ve seen this in the higher frequency data as well). Unsold inventory in May
was at 2.5 months supply, up from 2.4.”
To put it into perspective, the graph below shows levels of
inventory rising since the beginning of the year:
We’re still not close to a balanced market, which would be a
6 months’ supply of homes for sale. However, we are seeing a slow but steady
increase in homes coming up for sale. And that leaves many buyers and sellers
wondering the same thing: what does that mean for me?
Buyers: More Options Are Arriving, so It’s Time To Act
If you’re a buyer, more inventory coming to market is a
welcome sight. More supply means more options and less competition, which could
mean fewer bidding wars.
According to the latest Monthly Housing Market Trends
Report, supply levels are continuing to increase, which is different from the
typical summer market:
“In June, newly listed homes grew by 5.5% on a
year-over-year basis, and by 10.9% on a month-over-month basis. Typically,
fewer newly listed homes appear on the market in the month of June compared to
May. This year, growth in new listings is continuing later into the summer
season, a welcome sign for a tight housing market.”
If you’re having trouble finding your next home, this news
should give you the hope and motivation to keep your buying process moving
forward. Experts project mortgage rates will begin increasing, which will make
purchasing a home less affordable as time passes. You can still capitalize on
today’s low interest rates, so stick with your search as more homes come to
market.
Sellers: Our Supply Challenges Aren’t Over Yet, so Now Is
the Time To Sell
If you’ve been putting off selling your house, you shouldn’t
wait much longer. The year’s month-over-month gains in homes for sale have
helped buyers, but we’re still very much in a sellers’ market.
As the graph below shows, even with the number of homes for
sale rising, we’re still well below the supply levels we’ve seen historically:
Of course, more homes are coming to market now, and more are
expected in the coming months. Selling your house this summer gives you the
chance to get ahead of the competition and maximize your sales potential before
more homes are put up for sale in your neighborhood.
Bottom Line
More homes for sale mean more options for buyers and more
competition for sellers. Whether you’re looking to buy or sell, let’s connect
today to discuss your options and why it’s still a good time to make your move.
Source: Real Estate with Keeping Current Matters
