One of the bright spots in the current economy is real estate, but the one thing that may hold back the housing market in the fall from achieving its full potential is - low inventory.
You are probably aware that buyers are looking to capitalize on today's historically low interest rates, but there are not enough houses for sale to meet the growing demand.
Sam Khater, Chief Economist at Freddie Mac, states "Mortgage rates have hit another record low due to a late summer slowdown in the economic recovery. However, heading into the fall it will be difficult to sustain the growth momentum in purchases because the lack of supply is already exhibiting a constraint on sales activity."
National Association of Realtors note that the current unsold inventory sits at a 3.1-month supply. To have a balanced market the market needs inventory for 6 months. If this trend continues it will get even harder to find homes to purchase in the fall.
According to Chief Economist at realtor.com, Danielle Hale, "The overall lack of sustained new listings growth could put a dent in fall home sales despite high interest from home shoppers, because new listings are key to home sales."
"The post -pandemic period has brought a record number of homebuyers back into the market, but it's also failed to bring a consistent number of sellers back," notes Javier Vivas, Director of Economic Research at realtor.com.
There are two immediate takeaways from this message:
1. If you are thinking of selling your house this fall would be a great time to make that happen.
2. Realtors indicate that an average of 3 offers per house and an increase in bidding wars means the demand is there and the opportunity to sell for the most favorable terms favors the seller.
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