Just off the wires in the latest housing news...
WASHINGTON (MarketWatch) -- Construction of new homes dwindled to the second-lowest level in 50 years last month, as home builders sought to reduce the number of unsold inventories in an elusive quest to find the bottom of the historic housing collapse, according to government data Friday.
Housing starts fell 6.3% in September to a seasonally adjusted annual rate of 817,000, the lowest since January 1991 and just 19,000 above the record low, the Commerce Department estimated.
Starts of single-family homes tumbled 12% to an annual rate of 544,000, the lowest since February 1982 and the fourth-lowest ever. Read the full government report.
Housing starts were also revised lower in July and August. Starts in August were revised to 872,000, down from 895,000.
Of course, the big question is how can this be GOOD news?
It comes down to this. There is too much housing inventory on the market. In order to "find the bottom" and stabilize prices, the inventory and the demand need to reach a balance. The laws of Supply & Demand are not subject to judicial review. A few years ago, demand was far outpacing supply... people were willing to pay whatever it took in order to get into a house. Now, there are hundreds (or some places, thousands) of homes for each bona-fide buyer.
Of course, this doesn't do anything to address the existing inventory on the market ("used homes"), but it does mean that if demand remains steady, that inventories can fall. Even if demand drops off, inventories can still fall somewhat.
It isn't good news for builders and suppliers. And it isn't the greatest news for buyers. But, sellers ARE looking for stability. The finance industry is looking for stability. Even the stock market is looking for housing stability.
If you are a buyer, keep an eye on the supply. As supplies drop, those great deals will start to dry up. I know that the NAR is saying that "Now is the time" etc... and for many it is. For others it isn't. Talk with a mortgage pro. Talk with a real estate pro. Find people that want to build a long term relationship with you and aren't willing to just say whatever it takes in order to get you roped into something.
If you are a seller and you need to move, let's talk. I work to build better marketing than the next guy. I may be able to bring that to your situation.
If you are a buyer and this is a good time for you to buy, we can talk too. I understand the dynamics on both sides of the transaction. I can bring that expertise to your transaction.
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