There has been a shortage of homes for sale for a few years now. It takes awhile for trends to reach the mainstream media, which is why real estate bloggers are important. 🙂
I read all sorts of reasons for this phenomena. There were a few years during the housing crash and great recession when the inventory of homes for sale was abnormally high. There isn’t any point in comparing 2008 and 2009 to 2017.
A normal number of homes for sale would be somewhere between 3 and 4 times as many as we have on the market right now.
There are several reasons why we are seeing fewer homes on the market. Here are a few:
- Baby boomers own a lot of homes and are in an age group that is more likely to stay put than move.
- There are people who are hanging onto homes because they are still underwater or are waiting until their home is worth a certain amount.
- People who want to move to another house are holding off putting theirs on the market until they can find a home to buy.
- During the housing crash investors bought up a lot of homes, especially starter type homes and small condos. These homes have become rental properties and will not be going on the market anytime soon.
We could build our way out of this, yet there isn’t a lot of new construction. There are still vacant buildable lots left over from the recession and vacant houses too. The new construction and in fill building I see is expensive housing.
Local building codes do not allow for a lot of creativity. What we need the most is affordable housing, maybe tiny houses and micro apartments. Builders tell me that luxury housing is more profitable to build.
Eventually there will be a kind of sell off when large numbers of baby boomers put their homes on the market. Experts were predicting that the great sell off would start in 2020. Now some are predicting it will start in 2025.
Home buyers need to be patient and somewhat flexible. Houses are being sold every day. They are not just for sale in May either.
It is a great time to be a home seller but there are limits to how much sellers can get for their homes. Sellers who are willing to negotiate will get the best terms and the fastest sales. Finding a buyer for a home for sale is fairly easy but is just one part of what it takes to close a sale.
Also see Home seller expectations sky rocket