{"id":5887,"date":"2019-12-20T08:02:04","date_gmt":"2019-12-20T13:02:04","guid":{"rendered":"https:\/\/dankrell.com\/blog\/?p=5887"},"modified":"2020-02-08T08:24:59","modified_gmt":"2020-02-08T13:24:59","slug":"more-homes-for-buyers","status":"publish","type":"post","link":"https:\/\/dankrell.com\/blog\/2019\/12\/20\/more-homes-for-buyers\/","title":{"rendered":"More Homes for Buyers?"},"content":{"rendered":"\n
\"more<\/a>
Strength of the housing market<\/figcaption><\/figure><\/div>\n\n\n\n

If you\u2019ve been following the housing market, you know that housing experts have been declaring a home sale inventory shortage since 2013.\u00a0 In NAR\u2019s November 27th<\/sup><\/a> Pending Home Sales Index release, NAR chief economist Lawrence Yun partly blamed October\u2019s 1.7 percent decline to \u201cinadequate levels of inventory across the country.\u201d\u00a0 He stated \u201cThere is no shortage of buyers seeking homes, but a lack of available units continues to drag down the nation\u2019s housing market and overall economy<\/em>.\u201d Essentially, there needs to be more homes for buyers.<\/p>\n\n\n\n

However, if reporting holds true, the home sale shortage may be ending soon.  The most recent housing permits report indicates that more new homes will be built, while media attention to a \u201csilver tsunami\u201d suggest more homes for buyers will hit the market.<\/p>\n\n\n\n

October\u2019s increased housing permits suggest an increase in new homes to be built next year.  According to a recent report, housing permits reached a post-recession high (Housing Permits Surge to Postrecession High<\/a><\/em>; magazine.realtor; November 20, 2019).  Although permits are just an estimate for future construction, it is nonetheless relevant because, like pending home sales, it gives a hint of the potential for future home sales.  Single family permits reached 1.46 million units during October, which is an increase of about 5 percent.  October was the second-best month for housing starts this year. <\/p>\n\n\n\n

Lawrence\nYun, NAR chief economist, stated, \u201cAt 1.46 million units on an annualized\nbasis, housing permits are nearly to the level needed for the country over the\nlong haul.  Since new-home construction\nkicks off the chain reaction of people trading up and trading down by buying\nnew and selling their existing homes, more housing inventory will surely show\nup in the market next year<\/em>.\u201d  <\/p>\n\n\n\n

Robert\nDietz, the National Association of Homebuilders chief economist, commented about\ndemand for new homes, \u201cThe increase in buyer demand is also being driven by\nlower mortgage rates, which has been helping to lift the pace of single-family\npermits since April. Solid wage growth, healthy employment gains, and an\nincrease in household formations are also contributing to the steady rise in\nhome production<\/em>.\u201d<\/p>\n\n\n\n

What about existing homes?  According to Zillow Research, there will be about twenty million additional existing homes that will be for sale through the mid-2030\u2019s (The Silver Tsunami: Which Areas will be Flooded with Homes once Boomers Start Leaving Them<\/a><\/em>; Zillow.com; Nov. 22, 2019).  These home owners are 60 years-old or older, and will eventually sell their home because of health, retirement, relocation, and death.  There will be regional differences depending on the number of senior home owners.  Zillow indicates that the Tampa and Tucson markets are likely to be affected most.<\/p>\n\n\n\n

The \u201csilver tsunami\u201d is not a new concept.  It was postulated in a 2012 NAR article The Boomer Effect<\/a><\/em>.  The article surmised that since Baby Boomers began turning 65 on January 1, 2011, there would more homes for buyers and that the inventory would overwhelm the market.  However, we are still waiting for the tsunami. As it turned out, the post-recession economy significantly changed, as did attitudes toward housing.  Multi-generational households increased, and seniors are aging in place. <\/p>\n\n\n\n

Will the anticipated increased number of new and existing homes to be sold provide the boost to home sales numbers?  Maybe, if the added inventory is attractive to home buyers.  It has been clear that home buyers will opt for value in a turn-key home<\/a>.  Home sellers need to keep in mind that home buyers are looking for affordable quality homes.<\/p>\n\n\n\n

Original article is published at https:\/\/dankrell.com\/blog\/2019\/12\/20\/more-homes-for-buyers\/ <\/p>\n\n\n\n

By Dan Krell
Copyright\u00a9 2019<\/p>\n\n\n\n

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Disclaimer<\/a>. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws. <\/p>\n","protected":false},"excerpt":{"rendered":"

If you\u2019ve been following the housing market, you know that housing experts have been declaring a home sale inventory shortage since 2013.\u00a0 In NAR\u2019s November 27th Pending Home Sales Index release, NAR chief economist Lawrence Yun partly blamed October\u2019s 1.7 percent decline to \u201cinadequate levels of inventory across the country.\u201d\u00a0 He stated \u201cThere is no … <\/p>\n

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