When Will Housing Inventory Increase?
There’s no doubt that a home is a major purchase. In addition, anyone familiar with the law of supply and demand knows that scarcity tends to drive up prices. Therefore, it’s no wonder that that homebuyers across the country are asking the same question: When will housing inventory increase? While the last few years have been full of surprises, the experts are weighing in with their predictions.
Predictions for Housing Inventory in 2022
If you’re hoping to find more houses to choose from in 2022, you may be in luck. The Mortgage Reports says that many experts expect that the housing inventory will increase some in the coming year. Many would-be sellers who hesitated because they were uncomfortable about having strangers in their homes during the pandemic or unsure about the state of the economy are moving forward now; that’s bringing more existing homes on the market. Some investors may also capitalize on high home prices by placing rental properties on the market. In addition, a growing number of new homes should be joining the queue. However, don’t get too excited. These increases won’t be enough to return things to normal. In fact, Fannie Mae is predicting that the inventory will remain at 50 percent of what is needed to truly meet demand. Supply chain disruptions and labor shortages may also continue to trouble builders. Ultimately, it may take years before housing inventory fully catches up with demand.
Tips for Buying When the Inventory Is Tight
What can you do if you want to buy a house, and you don’t want to wait the years it may take for housing inventory to fully catch up with the demand for it? Implementing some tips for buying in a hot market can help you succeed. NerdWallet offers some advice worth considering:
- Do your homework first. Spend a little time investigating the real estate listings. Pay attention to how long homes are listed before they have a pending contract. Also, check recently sold listings to see the difference between the listed prices and the prices that homes sold for. This information will help you prepare to make smart, effective decisions when you’re ready to buy.
- Don’t get emotionally attached too quickly. People often talk about falling in love with a house. You won’t have that luxury in a hot market. Try to keep a cool head, and recognize that you may experience disappointments along the way as you work to find the right house.
- Select a great real estate agent. In a tight market, you need a real estate agent who knows how things work because there’s no room for error. Choose someone you feel comfortable communicating with who can serve as a guide when you need an expert.
- Prepare to compromise. While you may be able to picture your dream house clearly, you may not be able to find it in reality, especially when there are a limited number of houses available, and buyers are competing to snag them. Know the difference between what you must have in and a house and what you wish you could have. Be prepared to compromise on the wish list.
- Have your financing ready. Getting preapproved so that you have your financing ready is essential. It shows that you’re a serious buyer.
- Sweeten your offer. There are numerous ways to sweeten the deal. Consider an escalation clause, offer a rent-back agreement, or limit the number of contingencies attached to your offer.
- Be patient. In a competitive market, it can take several attempts before your bid is the winning one. Don’t give up, get careless, or get frustrated. Be patient, and keep trying.