Over the past year, the housing market has become increasingly frustrating for prospective homebuyers. Although home prices keep rising and housing inventory continues to shrink, buyer demand has held steadfast, until recently.
Demand from homebuyers fell off from March to February, dropping a 14%, according to Redfin. In January, buyer demand peaked as consumers felt confident in their jobs and the economy, but realization set in when March came around.
Typically, Spring is one of the most active seasons in the housing market, but this year there is not enough inventory to satisfy demand.
- Demand from homebuyers dropped 14% month-over-month in March
- The number of buyers requesting tours fell 5.5%, and the number of buyers writing offers dropped 23% in March
- Housing inventory has been declining for 22-straight months, and can’t keep up with demand
It may be the strongest seller’s market ever, but buyer frustration is now taking its toll. Some would-be shoppers are even choosing to sit the spring market out.
Demand from homebuyers fell 14 percent in March from February, according to Redfin, a national real estate brokerage. Redfin measures demand by looking at the number of customers requesting home tours and writing offers.
Demand had hit a record in January, as consumers felt better about the economy and anticipated a strong spring market. They clearly did not anticipate how few homes they’d find for sale.
Compared with February, the seasonally adjusted number of buyers requesting tours fell 5.5 percent in March, and the number of buyers writing offers dropped nearly 23 percent.
It’s not that Americans don’t want to buy homes, it’s that there are just too few homes for sale. Across the 15 metros covered by Redfin’s index, there were 12.5 percent fewer homes for sale than in March 2016. Inventory has now been falling annually for 22-straight months.
“The market is missing its moment because of too-low inventory,” said Redfin chief economist Nela Richardson. “Low unemployment rates and high consumer confidence should create continued momentum in homebuyer demand. But, instead, we’re seeing demand cooling when it should be peaking.”
View the original article at CNBC