Housing Supply Is Rising. What Does That Mean for You?

Housing Supply Is Rising. What Does That Mean for You?

An important factor in today’s market is the number of homes for sale. While inventory levels continue to sit near historic lows, there are indications we may have hit the lowest point we’ll see. Odeta Kushi, Deputy Chief Economist at First American, recently said of 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:

Inventory of houses for sale is rising

We’re still not close to a balanced market, which would be a 6 months’ supply of homes for sale. However, we are seeing a slow but steady increase in homes coming up for sale. And that leaves many buyers and sellers wondering the same thing: what does that mean for me?

Buyers: More Options Are Arriving, so It’s Time To Act

If you’re a buyer, more inventory coming to market is a welcome sight. More supply means more options and less competition, which could mean fewer bidding wars.

According to the latest Monthly Housing Market Trends Report, supply levels are continuing to increase, which is different from the typical summer market:

“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:

Months' inventory of existing houses for sale

Of course, more homes are coming to 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.

Bottom Line

More homes for sale means more options for buyers and more competition for sellers. Whether you’re looking to buy or sell, call us today to discuss your options and why it’s still a good time to make your move.

About the Author
Ron Headshot v1web Square

My wife and I live in Donelson, where we both were raised and graduated from high school (DCA Classes of 1983 and 1984).  Our current home is on the Cumberland River, very close to my childhood home and the former homes of both my McDonald and Rice grandparents.

Our daughter and son are grown now, and our daughter, Stephanie Miller, is my real estate partner.  She lives in Lebanon with her husband and their two children.  While Stephanie and I specialize in the areas of Downtown Nashville, Donelson, Hermitage, Old Hickory, Mt. Juliet and Lebanon, we have and do serve clients all over Middle Tennessee.

As a Nashville native, I’ve spent a lifetime watching our city evolve, and I am enthusiastic about showcasing it to others and serving their real estate needs.

Services

1997 — 2000   Fleetwood HOA Board Officer

2013 — 2016   Rhythm at Music Row HOA Board Officer

2017   Greater Nashville Realtors: Housing Opportunities & Affordability Committee

2017 — 2018   St. Martin Square HOA Board Officer

2017 — 2019   Brentwood Photography Group Board

2018 — 2019   Senior Ride Nashville


Memberships

National Association of REALTORS®

Tennessee Association of REALTORS®

Greater Nashville Association of REALTORS®