In February, tight supply of existing homes undercut potential sales for these homes at a 2.9 percent seasonally adjusted annual rate, totaling 153,000 in lost sales, per the latest data from First American.
Even though potential existing-home sales ticked up in February, a 5.17 million seasonally adjusted annualized rate, or 1.5 percent from January 2019, First American's Potential Home Sales Model report data show that current inventory struggles threaten potential sales, and the market potential for existing-home sales fell 2.9 percent annually, HousingWire reports, and that potential existing-home sales decreased 23.2 percent below the pre-recession peak.
So, what’s holding the market potential back? Well, Fleming says it is a lack of inventory. “Supply shortages have been the primary culprit for this performance gap – you can’t buy what’s not for sale,” Fleming said. “However, so far in 2019, we’ve seen mortgage rates decline and wages rise – both trends work to boost house-buying power and fuel greater market potential for home sales, setting the stage for a stronger than expected spring home-buying season.”
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