After bouncing back in July, pending home sales cooled in August for the third time in four months and to their lowest level since January.
The National Association of REALTORS Pending Home Sales Index declined 2.4 percent to 108.5 in August from a downwardly revised 111.2 in July.
The association’s chief economist, Lawrence Yun, says suffering supply levels have taken the wind out of the momentum the housing market experienced earlier this year.
According to Yun, evidence is piling up that without more new home construction the current housing recovery could stall.
Earlier this month, NAR released a new study that revealed single-family home construction is not keeping pace with job creation and is lacking overall in 80 percent of measured metro areas. When combined with the scant supply levels for existing homes, these tight inventory conditions continue to hamper affordability in many of the largest cities in the country – especially those in the West.
Tips to Help You Find a Home in a Low-Inventory Market
Follow these tips to help find a home sooner rather than later.
Follow the inventory: Inventory varies by location, property type and price range. You will have more to choose from, and probably get more bang for your buck if you search for a house in an area with more availability.
Look for homes investors avoid: Investors tend to steer clear of homes that cannot be flipped or rented, such as those in gated communities. Some of these communities let investors get away with flipping and renting when the market was hurting, but with the housing market recovery, homeowner associations are cracking down on investor activity.
Don’t forget “expired” and “canceled” listings: Many people try to sell their house by listing it on an MLS—but fail to complete a sale. Those listings become “expired” or “canceled.” Have a REALTOR® assist you in finding a home that is not currently on the market.
Seasonal patterns can favor buyers: Remember there are clear seasonal patterns for housing inventory. Identifying these patterns with a REALTOR® in your area can open up more opportunity for a great home purchase.