Lack Of Housing Inventory Is A Perpetuating Cycle

October 7, 2016

Homeowners have motivations to sell. They just don’t have the assurances that they’ll be able to buy.

Jonathan Smoke, the chief economist of, found one of the real reasons behind the U.S. housing inventory crunch.

The lack of housing inventory is a chicken-or-the-egg dilemma: Buyers can’t find a home because there aren’t enough on the market (which is also driving up prices), but sellers, while motivated by the higher prices, can’t sell because they’re afraid that they’ll end up homeless. Meanwhile, new home construction is growing but not enough to ease the logjam.

The site found that “wanting a different neighborhood” is by far the top motivation for selling. Other reasons include “needing a bigger home” and “needing a home with different features.”

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