Out of Control
March 22, 2022
With the number of available homes to purchase at extremely low levels, there simply are too many buyers competing against each other.
An Insane Market
When the Expected Market Time drops below 40-days, the Seller’s Market shifts from “hot” to “insane,” and today it is at 20 days.
Last year’s 23 day Expected Market Time was very similar to today’s ridiculous 20-day mark. In 2013, the Expected Market Time was at 33 days, the only year prior to COVID that reached the white-hot level for housing. The six-year average from 2014 to 2019 for this time of year was 69 days, much different than the current insane pace. With patience, buyers were able to isolate a home within a reasonable amount of time and were not competing against so many buyers writing offers on the same home.
The simple economic principle of supply and demand does not adequately capture today’s dilemma. There just is nothing available for buyers to purchase right now. Anything that does hit the market is greeted with a deluge of showings and plenty of offers. There really is nothing spectacular about the number of buyers looking to purchase today. That is not the issue. The issue is that there are only 1,556 homes available today in the middle of March, when there are typically around 5,400 (the six-year average between 2014 to 2019). Even with a similar number of buyers searching for a home today compared to past years, there are far fewer choices. This lack of FOR-SALE signs is precisely why the housing market is out of control.
As long as the inventory remains at catastrophically low levels, expect more of the same.