A tight market strikes back!
If you are on the market to buy a newly built home, expect to find fewer choices and scarcer discounts.
The inventory of new houses for sale is at a record low. As of July, there were about 142,000 newly constructed homes for sale in the United States, according to the U.S. Census Bureau.
Basically, builders have stopped building for the last three years, and the industry has come to a virtual halt.
As the housing market improves, homebuilders have slowly started to build again. But it is going to take at least two years before the availability of new homes for sale significantly improves.
At the current sales pace, the inventory of new homes is enough to last about 4.6 months. A balanced market usually is about six months.
Because of the low inventory, builders face less competition. For buyers, that means fewer incentives and discounts.
That doesn’t mean you should pay what the builder wants. There is always room for negotiation.
I think the builders are going to continue to offer some incentives but not to the extent they did in the depth of the crisis.
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