Does Inventory Really Explain Home Sales Slump?
Almost everyone has said it or heard it: Existing Home Sales are in the toilet because there's no inventory and there's no inventory because no one wants to give up their 3% mortgage when rates are 7%.
"There are simply not enough homes for sale," according to NAR Chief Economist Lawrence Yun. "The market can easily absorb a doubling of inventory."
To be sure, more inventory would be a good thing in almost every regard. A doubling of inventory would likely keep prices in check or push them slightly lower, but it might not conjure up as much buying demand as you might assume. Two separate stats in today's Existing Home Sales data illustrate the point. The first is for inventory in terms of UNITS.
This chart makes it seem as if inventory is in line with all time lows and
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