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Why Is Housing Inventory So Low?
The most obvious reason is that many homeowners are holding onto their historically low mortgage rates (2.5%–4%), making it hard to justify selling with today’s higher rates. At the same time, home prices have surged 52% in five years, creating affordability concerns.
Those who want to sell often ask, “Where would I go?”, leading many to stay put or “wait out the market,” while others decide to use their home’s equity to renovate instead of relocate. Until interest rates or market conditions shift, inventory will remain low—but with the right understanding of the market, opportunities still exist to locating your next dream home.
The Northern NJ Market
Buyer demand remains strong, yet many towns in Northern NJ have less than five homes for sale, and frequently go days without any new listings.
What everyone seems to be waiting for, according to most experts, is the interest rates to come down. Once that happens, inventory is expected to rise as more homeowners list their properties. However, many of these sellers will also become buyers, likely sparking even greater competition for the newly listed homes. Meanwhile, home sales continue to rise!
Mortgage Rates
"The Freddie Mac rate for a 30-year mortgage drifted lower to 6.85% this week as the market digested recent inflation data." Click for more
If you have any questions about the market in your area, feel free to reply to this email or call me.
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