Supply Growth Up Quarterly, Down Annually

Inventory on the housing market grew 12.2 percent in the second quarter over the first, and slowed the double-digit downward trend from the past 14 consecutive quarters, down only 5.3 percent, per the latest Trulia report.

This year's inventory growth in the second quarter is the biggest since 2015. Of the 100 largest metros in the nation, 30 had annual inventory growth as of the second quarter, and 25 of those metros bounced back from 2017 inventory decreases. Nashville, Tenn. and Salt Lake City built more homes than their historic averages in 2017, reports Trulia, and Music City had 52 percent inventory growth in Q2 2018, versus 11.6 percent in Q2 2017. San Diego had 22 percent year-over-year inventory growth, while in 2017, the city had a 28 percent decrease in inventory.

This inventory growth is heartening, but it hasn’t stopped the relentless march of unaffordability. More properties may be on the market, but the upward creep of prices and mortgage rates is putting homes in these metros further out of reach. More inventory may be helping to cool off the bidding wars in these areas, but homebuyers are getting no relief from the unaffordability squeeze.

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