Housing supply and demand is painfully out of balance

Housing supply and demand is painfully out of balance

Housing supply and demand is painfully out of balance
Low housing inventory has plagued the market for years and has only grown worse in 2020 as demand from buyers continues to rise. Pandemic-era home buying has Americans looking for more space and better communities and they have only been further motivated by near record-low mortgage rates. As a result, home buying is outpacing new listings coming on the market by a wide margin.

The shortage of homes for sale is expected to continue well in to next year unless more sellers list their homes. While home sales have risen 19.29 percent this year compared to 2019, new listings have only climbed by a paltry 0.22 percent compared to last year.

This chronic and crushing divide between sales and inventory has led to one of the sharpest periods of home price increases on record. The average list price for properties that sold increased 6.7 percent from September to October alone.

Today, conforming no-point 30-year fixed mortgage rates are averaging 2.875 percent and 15-year rates are near 2.375 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.