The real estate industry is facing yet another hurdle, as homebuyers are now grappling with a shortage of housing inventory. Danielle Hale, chief economist at Realtor.com, spoke about the issue during an interview on "Mornings with Maria." She explained that while there is expected to be a slight increase in single-family construction next year, it will not be enough to make a significant impact on the shortage. Hale remains optimistic about the industry's ability to improve the inventory situation but acknowledges that it will take several years to fully address the deficit.
For first-time homebuyers, the dream of homeownership may seem distant due to the inventory shortage. Hale stated that listing prices have been relatively flat, with home prices fluctuating in recent months. Additionally, builder confidence in the housing market has been declining for the third consecutive month, largely due to the impact of higher mortgage rates on consumer demand.
Hale predicts that home prices will start to decline more consistently in 2024, although the shortage of inventory will prevent a significant drop. She expects a modest decrease of 1.7% for the year.
Renters are not finding much relief either, as Hale noted that renting may be the only option for families looking to save on housing costs in the current market. With high costs in the housing market, there are limited opportunities for savings.
Overall, the real estate industry is facing challenges on multiple fronts. The shortage of housing inventory is impacting both homebuyers and renters, making homeownership and affordable housing difficult to attain. While there are some expectations for improvement in the coming years, the road ahead will be a long one.