Inventory is low so demand is high.
- Housing inventory has shrunk to levels not seen since 2006 with listed inventory at 20.4 percent below a year ago.
- Lower inventory is surging the recovery in home prices and is pushing up home prices.
- In dealing with insufficient housing inventory, potential buyers are scrambling to bid on homes before they're even listed.
Home prices have increased.
- National Assn. of Realtors reports that the national median existing-home price for all housing types rose 7.9 percent in May from a year ago
- “Prices continue to climb at the national level, with each of the four regions showing improvements over last month. The West continued as the front-runner in terms of overall market correction”, said Dr. Alex Villacorta, Director of Research and Analytics at Clear Capital.
- According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage declined to a record low 3.80 percent in May from 3.91 percent in April; the rate was 4.64 percent in May 2011.
Buyers are better qualified.
- Consumer credit quality is improving. On July 17th, S&P Dow Jones Indices and Experian released June 2012 data which measures consumer credit default rates. June data showed a decline in the composite index led by a nine basis point drop in first mortgage default rates.
- The housing data firm, CoreLogic, reported that shadow inventory stood at a 15% decline from the same month a year earlier.
- "This is one of the reasons why some markets that were formerly identified as deeply distressed, like Arizona, California and Nevada, are now experiencing price increases.” CoreLogic chief economist Mark Fleming said. Shadow inventory has shrunk 28% since peaking at 2.1 million units in January 2010.
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