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Housing shortage starts easing as listings surge in June

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The historic housing shortage caused by construction delays and a one-two punch of strong pandemic demand is finally beginning to ease.

The active list of homes in June surged 19%. This is the fastest annual pace since Realtor.com started tracking metrics five years ago. And the number of new listings for the month finally surpassed typical pre-Covid levels, up 4.5% from a year ago. However, overall inventory is still about half the pre-Covid level.

Among the markets where demand surged the most during the pandemic, there are also markets where supply increased the most. Austin’s inventory has increased by nearly 145% from a year ago, Phoenix has increased by 113%, and Raleigh has increased by nearly 112%. In other markets, supply is still declining. Miami is down 16%, Chicago is down 13%, and Virginia Beach is down 14%.

“We expect additional inventories in July based on the accelerated improvements during June,” said Daniel Hale, chief economist at Realtor.com. He added that he did.

And Mr. Hale could add new supplies as more homeowners could decide to sell, buyers tackle higher costs and find it harder to find a home that fits their budget. Said.

Still, supply expansion has not yet eased soaring home prices. According to Realtor.com, the median listing price in June reached a record high of $ 450,000. Annual profits are slightly modest, but still increase by almost 17%. This is partly due to the rising share of larger and more expensive homes.

According to a new report from real estate data provider ATTOM, the cost of owning an average-priced home in the second quarter required 31.5% of the average US wage. This is the highest percentage since 2007, up from 24% in the previous year, and the biggest leap in more than 20 years. Lenders generally see a debt-to-income ratio of 28% as the upper limit for approving a mortgage. As a result, some potential homebuyers today are disqualified from mortgages.

As a result, affordable home purchases fell by 97% nationwide in the second quarter, according to ATTOM. This is up from 69% in the same quarter a year ago, the highest since just before the collapse of homes in the Great Recession.

ATTOM calculates the affordability of average wage earners by determining the amount of income required for the major home ownership costs of an average priced home.

Rick Sharga, Executive Vice President of the company, said: ATTOM’s market intelligence.

Several factors can impede continued growth in inventory levels, including a retreat from potential sellers who may decide to wait for the market to strengthen again. Still, Hale of Realtor.com may feel that it’s the right time to buy, as new and pending home sales have increased this month.

“As expectations for future mortgage rates rise, homebuyers today can be more motivated, especially now that they have more choices,” Hale said.

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