Do you remember the doom and gloom headlines from just a few years ago regarding the “massive” and “shadow” inventory of unwanted homes for sale? Many commentators expected the overhang to persist for many years and continue to force property values down.
Some of those headlines are amusing today when you consider the historical perspective. Even at the height of the post-crisis period in 2010, inventory was in line with past peaks. It has now declined to well below the long term average. The “shadow” inventory consists of foreclosed homes held by banks and is not included in the regular stats, yet despite gloomy predictions, there doesn’t seem to be much negative impact.
Data is compiled by Estate of Mind, Inc., and sourced from the US Census and prior/currently published series from NAR.org, including Inventory and Months’ Supply of Total Existing Home Sales Series, U.S. 1999-Present and others. Reprinted with permission. Copyright National Association of Realtors®. Varied collection sources and changes in data collection methodologies, sampling and modeling techniques can result in statistically insignificant adjustments from period to period. All data is presumed accurate but not warranted.
Rather than falling values, markets with tight supply are seeing prices rise. That’s welcome news for all who currently own a home and an incentive for those who would like to purchase. In addition, many would-be trade-up buyers are encouraged by the prospect of selling their current homes for an acceptable price.
Rates have risen lately, yet levels are still incredibly low relative to long term averages. All in all, opportunities abound! What an exciting time to be part of the Real Estate industry!