What does it mean when people say we have "low inventory?" Quite simply it means we don't have enough homes for sale. There is WAY more demand than supply. The homes that do sell are selling very quickly, and in many cases buyers are losing out to multiple offers. It is a SELLERS market. That means that the current market conditions are a benefit to sellers more than buyers.
So how do we fix this and get a more balanced market? Quite simply, it's new construction. We need builders now more than ever. We need new homes, and particularly spec homes, to help increase the supply and balance out the market. Builders are naturally gun shy to build to many specs because many lost their hind ends in the recession and are afraid to expose themselves to too much risk. But the current market conditions call for more and more new construction.
The best case scenario is if the new construction could be in the $250,000-$350,000 price range. This will help more first time home buyers get into a new affordable home. Right now, land costs and building costs are up, making it hard for first time home buyers to build a home or purchase a new spec home. It's priced just beyond their means.
However you slice it, now is the time for new construction to make hay and close the gap in the housing market. With baby boomers downsizing and millennials entering the housing market, the demand for homes is high. Now we just need for the supply of homes to keep up with the demand.
Matt Heilman is a realtor with the Matt Heilman Homes team at Keller Williams Realty in Madison, WI. For all your buying and selling needs, contact Matt at 608-279-5771, [email protected]
Author:Matt Heilman Phone: 608-279-5771 Dated: March 16th 2017 Views: 1,116 About Matt: ...
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