While the national level of housing inventory has remained relatively flat, there are some individual markets that have seen a noticeable increase in available homes. This can be attributed to a few different factors, including increases in new construction and more people listing their homes for sale.
In addition, many homeowners who had postponed putting their home up for sale due to financial uncertainty caused by the pandemic are now feeling more confident about doing so. As such, these sellers are entering the market and increasing housing supply at an unprecedented rate.
Ultimately, this influx of available homes benefits buyers as it gives them more options and potentially better prices when they’re ready to make a purchase. To situate yourself within this landscape, talk with your local real estate agent to get a better understanding of your options. They’ll be able to provide you with guidance and insight that’s tailored to your local market, so you can make the best decision possible.
Now may be the right time for you to enter the housing market: more homes are available than ever before, and interest rates remain low. To make sure you’re confident in your decision and get the most out of your purchase, work closely with a trusted real estate agent who can help guide you through the process. With their assistance—and your armament of knowledge about current market conditions—you can feel good about buying a home that meets all your needs.
The reason for this extended inventory is two fold. First, the pandemic put many home sales on hold as buyers and sellers were wary of participating in open house tours or signing contracts in person. This meant that homes listed earlier in 2020 took longer to sell and remained active listings on the market.
Second, fewer new homes are being built due to higher costs associated with labor and materials caused by the pandemic. In addition, lenders have become stricter when approving mortgages because of economic uncertainty. This has made it more difficult for prospective buyers to obtain financing, further reducing demand for new homes and leading to a slower buildup of housing inventory than predicted before the crisis began.
Altogether, these factors have increased available housing supply and have the potential to affect both buyers and sellers. For buyers, it means a larger selection of homes to choose from and more flexibility when negotiating price. However, due to the economic uncertainty caused by Covid-19, buyers should also be prepared for longer wait times in closing on their purchase.
For sellers, there is now more competition with other listings so they may need to make slight adjustments to their asking price or even offer extra incentives like home staging services in order to stand out from other listings. Additionally, since the market favors buyers right now, sellers may not ultimately get their desired selling price and should be aware of that before listing their home.