Housing Shortage Deepens As Coronavirus Pushes Inventory Down
Only time will tell how deeply the pandemic will affect housing inventory, but in most areas, it won’t help, which does not come as a surprise considering the virus is disrupting almost every U.S. industry. Despite the coronavirus' impact, however, Realtor.com says the main culprits of March’s low housing inventory are familiar to the industry: under-building, Millennials starting to buy homes, and downsizing. Though March’s 15.7 percent drop reflected a year-over-year decrease, February wasn’t that far behind at 15.3 percent down. Still, as more potential sellers pull their homes off the market to wait for a more stable economy and builders slow down to follow social distancing guidelines, the virus' impact will likely grow.
The number of homes for sale was hovering around record lows before the coronavirus pandemic hit the United States. Now, amid a public health and economic disaster, inventory is falling even further, just before what would typically be the busy spring buying season.
The number of homes for sale nationally dropped 15.7% in March compared with a year earlier, according to a recent realtor.com® analysis of active listings. That's about 191,000 fewer homes for buyers. (Realtor.com looked at the 50 largest metropolitan areas to identify which saw the largest annual drops in homes for sale.)