Inventory levels across the nation are rising, but what does that mean? Are we in a bubble? Will the market crash? Will prices come down?
As I've said before, this market is bananas. Nothing like we've ever seen before.
Last week, total available inventory in the US climbed a whole 1%, up 327,000 units. Now, this is an uptick in inventory. It's only 1%, but it's an uptick. Any uptick is a sign of hope for buyers. That being said, we're still down 54% in inventory from where we were last year at this time. Let's take a look at everything that was happening in 2020 and what was causing the inventory crisis.
First of all, people weren't selling, interest rates were dropping and buyer demand became insatiable. 25% of homes that would hit the market would go pending in less than 24 hours. Another 25% would go pending in less than a week. Home prices across the nation are up 15%, but historically, June is the month when we start to see prices level out. So what does this mean?
Right now, the housing market is still incredibly under supplied, but what I suspect is going to happen is that with the rising inventory, we might se prices start to level out. Do I think we're in a bubble? As I explained, the market we're in right now is not like 2008. This market is a direct result of an inventory crisis. I'm not a psychic, and I don't claim to predict the future, but if 2021 follows any sort of a historical trend, and inventory levels continue to rise, buyer demand begins to wane, I do believe this market is going to become more of a balanced market. I don't expect prices to drop. In fact, I expect them to continue to rise but at a more healthy level than they have been in the past few months. I also expect interest rates to rise.
For more information or to answer any more questions, follow my upcoming video series when I talk about upsizing, when to sell and how to buy. For any other questions, feel free to reach out. And remember, whether you're buying a home or selling a home, it all starts with a dream. Let's dream together.