In a previous article, I told you we were in a seller’s market. But where are we heading? Even though there is still a lack of homes for sale, the mortgage rates are, slowly but surely, going up. As a consequence buyers could become scarcer. Here’s a look at four items to better understand the rebound of the housing market at a national level.
First of all, the real estate market shifted in a short amount of time. In a regular market, prices increase after the inventory of houses for sale shrinks. In this unusual recovery, things went the other way around. Without shrinkage of inventory, developers decided to increase prices. They actually even admitted they pushed prices too far. For instance, when you compare the new home orders year-over-year, the demand only increased 1% in August against 11% in July. Nowadays, purchasers are more thoughtful before investing in a condo.