An important factor in today’s market is the number of homes for sale. As our housing supply is rising, inventory levels, though continuing to sit near historic lows, show indications that we may have hit the lowest point we’ll see. Real estate brokers closely observe these trends and these observations are further echoed by Odeta Kushi, Deputy Chief Economist at First American, who recently commented on our supply challenges:
“It looks like inventory may have hit a bottom (we’ve seen this in the higher frequency data as well). Unsold inventory in May was at 2.5 months supply, up from 2.4.”
To put it into perspective, the graph below shows levels of inventory rising since the beginning of the year:
We’re still not close to a balanced market, which would be a 6 months supply of homes for sale. However, with the housing supply rising, we are seeing a slow but steady increase in homes coming up for sale. And that leaves many buyers and sellers in the Chicago real estate market wondering the same thing: What will this rise mean for me?
Buyers: More Options Are Arriving, so It’s Time To Act.
If you’re a buyer, more inventory or housing coming to market due to the housing supply rising is a welcome sight. An increasing supply means more options and less competition, which could mean fewer bidding wars.
“In June, newly listed homes grew by 5.5% on a year-over-year basis, and by 10.9% on a month-over-month basis. Typically, fewer newly listed homes appear on the market in the month of June compared to May. This year, growth in new listings is continuing later into the summer season, a welcome sign for a tight housing market.”
If you’re having trouble finding your next home, this news should give you the hope and motivation to keep your buying process moving forward. Experts project mortgage rates will begin increasing, which will make purchasing a home less affordable as time passes. You can still capitalize on today’s low interest rates, so stick with your search as more homes come to market.
Sellers: Our Supply Challenges Aren’t Over Yet, so Now Is the Time To Sell.
If you’ve been putting off selling your house, you shouldn’t wait much longer. The year’s month-over-month gains in homes for sale have helped buyers, but we’re still very much in a sellers’ market.
As the graph below shows, even with the number of homes for sale rising, we’re still well below the supply levels we’ve seen historically:
Of course, housing supply is rising in the market now, and more are expected in the coming months. Selling your house this summer gives you the chance to get ahead of the competition and maximize your sales potential before more homes are put up for sale in your neighborhood.
More homes for sale means more options for buyers and more competition for sellers. Whether you’re looking to buy or sell, let’s connect with real estate brokers at KM Realty Group LLC, Chicago today to discuss your options and why it’s still a good time to make your move.