Two months after a record high, homebuyer demand decreased 14 percent in March from February, according to a new report from Redfin.
According to CNBC, the drop is due to the nation’s incredibly low inventory levels. Per Redfin data, the number of homes for sale fell 12.5 percent from March 2016, and last month was the 22nd straight month where inventory decreased on an annual basis.
The number of buyers requesting tours dropped 5.5 percent in March, and the number of buyers writing offers declined 23 percent. Mortgage applications increased 1 percent annually, but last year the rate was at 17 percent.
CNBC posits that the housing shortage is causing potential buyers to sit out.
At a recent Sunday open house in Burbank, California, buyer frustration permeated the event. "I'm a little nervous about it. I'm intimidated," said Lena Araradie, a renter who said all of the homes in desirable areas were going quickly and far above asking price. She is looking at homes about $40,000 under her budget because she knows she will likely get in a bidding war.
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