After a whirlwind two years for homebuyers, sellers, and investors alike, the housing market is finally beginning to cool, but prices are still rising while demand remains strong in most regional markets across the U.S., John Burns Real Estate Consulting reports. Both resale and completed home supply are over 80% below norm, a metric which could soften the blow of a drop in buyer demand.
In a booming rental market, price hikes are expected to continue, while some apartment and rental home submarkets could be at risk of oversupply if conditions persist.
Safeguards against uncertainty
- Very little money has gone into land development, limiting future lot availability. This will constrain future new home supply.
- Large home builders are now developing their own land, partially financed by land bankers.
- Big builders have also taken advantage of historically low interest rates and turned to the bond market. The top seven builders have about $25B in debt, with less than half due in the next 5 years.
Advertisement
Related Stories
Economics
Mortgage Applications Increase Week-Over-Week, but Rates Remain a Challenge for Buyers
Data from the Mortgage Bankers Association show slight signs of optimism in national housing market
Single-Family Homes
Single-Family Permits Increased by 26% During March
The total number of single-family permits reached 241,311 year-to-date, with the West seeing the greatest rise
Affordability
Median US Down Payment Falls by More Than $4,000
The recent decrease in costs is welcome relief for homebuyers, but many West Coast markets remain expensive