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With mortgage rates low and the job market strong, Americans are ready to buy homes. The one thing missing from the equation? The houses themselves. The housing supply hit a record low with the fewest number of houses on the market at the end of November since 1999. To rub salt in the wound, the supply is the lowest in the affordable market where demand is sky-high, pushing prices up. The supply of luxury homes is steady, but that does little to alleviate the struggles of families trying to purchase an entry-level home.
The number of homes for sale at the end of November was the lowest on record for the month, according to the National Association of Realtors, which began tracking this metric in 1999. There were just 1.66 million homes on the market, down 5.7% compared with November 2018. That represents a 3.7-month supply at the current sales pace, down from a 4-month supply a year ago.
Supply is leanest on the low end, where demand is strongest. For homes priced below $100,000, inventory was down 15% annually. For those priced between $100,000 and $250,000, supplies were 7% lower annually. Supply is only growing on the high end of the market, where demand is weakest.
The housing shortage has reignited home prices, which had been cooling last year and into the first months of this year. The median price for an existing home sold in November was $271,300, the highest November price reading since the Realtors began tracking in 1999.
