While everyone is discussing the recent jump in housing inventory levels (especially in some local markets) and how that is going to lead to the housing crash of 2022. Altos announced a pretty amazing revelation/prediction. They also see housing inventory levels rising they do, however, disagree on what this means for housing by the end of the year…
- “There are now 509,000 single family homes available unsold on the market across the US. That’s the most we’ve had in almost 2 years, and 31% more than last year at this time…We expect that the summer will peak with maybe 625,000 homes on the market and end the year with around 540,000.”
Why are they predicting inventory levels will rise and then fall back down to the current levels? Two reasons…
- Slowing. “The 3.6% weekly inventory increase is substantial, but may be showing some signs of decelerating. A month ago, inventory was climbing by 6-7-8% per week. Now we’re in the 4% range.”
- Front running. ” You can imagine that sellers who were thinking of selling at some point this year are hurrying to list now – before they perceive the market will get even slower. If that is indeed happening, that would put a cap on inventory growth later in the year.”
It should be noted, that Altos does argue that new construction could be a wild card because supply chain disruptions are making it harder to predict upticks in inventory levels. However, it is important to remember that every inventory swing was first predicted by Altos. They were the first to see inventory levels drop at the start of the year before the housing market caught fire. They were also the first to notice the uptick recently that has put the brakes on housing. Everyone else might be running around saying the sky is falling because inventory levels are rising. I, however, will keep my eyes on the people and data that have been right over these last two years. I recommend you do the same.
