Low Inventory To Continue
I predict home inventory will remain low. In fact, one key reason prices haven’t fallen more, is that the number of homes offered for sale has declined. The main reason this trend will continue is mortgage rates. More than 80% of Texans with a mortgage have a locked-in interest rate in the 4s or lower. In fact, many of them are in the 2s and 3s. With rates now over 6%, many would-be sellers have decided to stay in their current home because they don’t see the need to increase their monthly mortgage payment. Obviously, there are many reasons that people have to move and so they will end up getting a higher interest rate when they do so. But for those who don’t have a compelling reason to move, the “lock-in” effect of their current low rate will keep them from moving, thus helping to keep the supply of homes low.