The paucity of houses on the market remains a nagging hurdle for those Americans interested in trading up or looking to take their first step into homeownership.
With a limited number of property listings amid solid demand, sellers have little reason to reduce asking prices. From December through February, less than four months’ supply of existing houses were on the market, compared with a post-recession high of about 12 months’ worth in mid-2010, according to the National Association of Realtors. Yes, interested sellers take their homes off the market during the winter, but such a lean supply over a similar time frame has never been recorded in about two decades of data.
The pace of income growth is lagging behind that of property values. Combined with the sting of higher asking prices, affordability constraints mean rental demand will remain robust, allowing investors to maintain a solid foothold in the market, according to Lawrence Yun, NAR’s chief economist.
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