Wouldn’t you know it? There are still buyers wondering if now is the time to buy a home. Now, when inventory is extremely low, mortgage interest rates are starting to rise and home prices have seen huge price jumps in many markets.
And yet there are some who believe there may be a price advantage to waiting a few more months, until we get into the fall and even winter season. But more on that in a moment.
There’s no question that the real estate market is healthier than it has been in years, but the headlines aren’t quite giving consumers the whole story. While existing home sales, new construction sales and home prices are trending up, they are still below their prerecession peaks, noted Amy Crews Cutts, senior vice president and chief economist for Equifax.
Single family housing starts are still down around 60 percent from the prerecession peak, while existing home sales are still down about 38 percent and prices are down roughly 20 percent.
“Even with large percentage gains in housing measures, all major indices of housing market vitality point to a long recovery yet to come,” she said in a live webinar on the housing market hosted by Ilyce. (Full disclosure: Ilyce also serves as the managing editor for the Equifax Finance Blog.)
What’s keeping the housing market depressed isn’t a lack of buyers but a lack of inventory. There simply aren’t enough houses to buy. Home builders can’t build homes fast enough: There aren’t enough building materials in some communities, and others are experiencing a shortage of construction workers.
This lack of inventory is starting to push up prices and is making the market move much more quickly, noted Steve Cook, editor of Real Estate Economy Watch, and the former head of public affairs for the National Association of Realtors.