It seems as though everyone is talking about the limited number of homes on the market. Over the next couple of blogs, we are going to share inventory insights to provide a deeper understanding of the current market.
To kick it off, here are just some reasons for low inventory:
1. The US has been under-building for over a decade.
2. Most builders have focused more of their efforts on more expensive, more profitable homes.
3. Low interest rates have allowed people to pay more which fuels excessive price escalation.
4. Institutional investors and i-buyers are competing with "regular" home buyers further depleting inventory.
5. COVID fueled migration from more expensive areas to cheaper areas of the US has driven prices up in those areas with increased demand.
6. Vast new wealth created from rapidly rising equity markets, crypto speculation, IPO's, new business creation, inheritance, wealth transfer, etc. has created a huge new pool of buyers, many armed with cash.
7. The largest buying audience, millennials, are buying instead of renting after years of holding back.
8. Empty nesters seeking smaller homes are competing with first-time buyers for smaller homes.
Despite low inventory "on the market", there is quite a bit of inventory trading that barely makes it to market, if at all, because it is sold before it comes to market. Hint: Stay tuned for more on this.
For eager buyers, it is increasingly important to work with a professional, connected agent who knows inventory and local agents.
