Why aren’t there more homes for sale? The lack of inventory continues to stifle the real estate market, but there aren’t any good reasons offered for what seems on the surface a bit of a paradox. The total volume of resales, according to the National Association of Realtors, was in the prior month (January 2017) the highest in more than a decade. That sounds good, but in reality it is less striking than it is made out to be and was more of an aberration than indicative of a healthy market. The volume of home sales fell sharply in February to a level more consistent with the past few years.
There is clearly something amiss, though almost every mainstream outlet is reluctant to state it. In fact, as I noted one year ago yesterday, it had become habit for the NAR’s chief economist Larry Yun to blame “unexpectedly” weak February’s on the weather rather than consider more forcefully the inventory side; he did this for February 2014, February 2015, and once more for last February. This year, their press release is thankfully devoid of snow and winter, but is instead left to incomplete lamentations about affordability.
Part of the problem in blaming winter those previous years was all the talk about wage and economic growth that was supposed to be unleashed long before now. That was the view of the unemployment rate, and one widely shared among economists and policymakers alike (who refused the clear, common sense counter interpretation of oil). By citing “affordability” rather than temperature, the NAR has apparently wised up – but not quite all the way.
A growing share of homeowners in NAR’s first quarter HOME survey said now is a good time to sell, but until an increase in listings actually occurs, home prices will continue to move hastily.
It may be too much parsing of what may actually be boilerplate sales language, but it still doesn’t actually square with the figures for inventory. People say it is a good time to sell, but the relative number of people who are actually doing so has drastically shrunk and for almost two years now.
No Comments