Shortage of homes may be culprit in slower economic recovery

Shortage of homes may be culprit in slower economic recovery

Shortage of homes may be culprit in slower economic recovery
Real estate activity was higher last week than it was before the pandemic began, a sign of resilience and a positive economic outlook for the near future. However, a shrinking supply of homes for sale may soon put the brakes on this speedy road to recovery.

Realtor.com’s Housing Market Recovery Index posted a reading of 107.7 points for the week ending September 5. This represents a 7.7 point increase above the pre-COVID baseline established and 1.5 points above the week prior. During the same week however, the ‘housing supply’ component fell to 95.7, a reading below the pre-pandemic baseline.

Low mortgage rates have allowed current homeowners to settle in to smaller monthly mortgage payments, enticing them to stay put in their current home rather than consider a move.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 2.875 percent and 15-year rates are near 2.5 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.