How Low Inventory Can Affect The Housing Market This Fall

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How Low Inventory Can Affect The Housing Market This Fall |  Simplifying The Market

Real estate is still called ‘bright spot‘in the current economy, but there is one thing that may prevent the housing market from reaching its full potential this year: the lack of homes for sale.

Buyers are actively looking for and buying homes, aiming to capitalize on today’s historically low interest rates, but there are simply not enough homes for sale to meet that growing need. Sam Khater, Chief Economist at Freddie Mac, explains:

Mortgage rates hit another record due to a late summer slowdown in the economic recovery … These low tariffs have sparked strong buying-demand activity … However, going into the autumn, it will be difficult to sustain the growing momentum in purchases because lack of supply already shows a limit to sales activity. “

According to the National Association of Agents of Agents (NAR), now, unsold inventory sits at 3.1-month supply at the current sales rate. To have a balanced market where enough homes for sale are enough to meet a buying requirement, the market needs inventory for 6 months. Today we are nowhere near where that number should be. If the trend continues, it will be even harder to find affordable homes this fall, and that may slow down potential buyers. Danielle Hale, Chief Economist at, notes:

“The general lack of continued growth of new listings could hinder fall home sales despite high interest from home buyers, because.” new listings are key to home sales. ”

La Weekly Report on Report pay attention to the number of listings coming into the market (houses for sale) and the total number of lists remaining in the market compared to the previous year (See graph below):How Low Inventory Can Affect The Housing Market This Fall |  Simplifying The MarketBuyers clearly collect homes faster than they sell. The number of total listings (the orange line) continues to decline even as new lists (the blue line) come to market. Why? Javier Vivas, Director of Economic Research at, notes:

“The post-pandemic period has brought a record number of homebuyers returned to the market, but it also failed to bring back a steady number of sellers. Homes are selling faster, and sales are still growing, but rapidly declining inventory also means more home buyers are being depreciated. If we don’t see a material improvement to supply in the coming weeks, we could see that the number of transactions is declining again even as the number of buyers continues to grow. “

Does this mean it’s a good time to sell?

Yes. If you’re thinking about selling your house, this fall is a great time to realize it. There is a lot buyers are looking for affordable homes because they want to take advantage of low interest rates. Real estate agents also report on average 3 offers per house and an increase in supply wars, which means the demand is there and the opportunity to sell for the most favorable conditions favors you as a seller.

Bottom Line

If you’re considering selling your home, this is the perfect time to connect so we can talk about how you can take advantage of the market trends in our local environment.

Content previously posted in Keep Current Things

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