Inventory Levels Rise Again

Last week Mike Simonsen predicted that inventory had peaked and was likely to keep falling. However, it looks like inventory still has some room to grow, according to the latest weekly report from Altos Research.

• Available supply grew by 1% this week to 572,000, normally inventory shrinks by 1-2% per week this time of year.

• As a result of the unseasonal gains, Altos projects that EOY inventory will increase to 510,000 single-family houses.

Home Prices. Prices are falling slowly as expected with the median price of single-family homes holding at $430k. Altos is projecting a price closer to $400k by the end of the year.

• Price reductions ticked up half a percentage point to 42.5% for the week which Altos believes still has room to grow before hitting its peak.

• Mike Simonsen tweeted, “that the current situation implies that macro conditions will need to improve dramatically in order to even hope for flat YoY home prices in 2023.”