According to recent reports from MReport and Redfin, the housing market is moving in a good direction! The study showed that the sales for new construction homes increased by 10% during the month of July. July sales levels are getting close to those of pre-COVID sales levels. Experts claim a major cause for this uptick is the change in housing migration patterns. Many studies have revealed that since the pandemic began, many Americans have decided to move to the suburbs or rural areas. This is due to the fact that they are able to work remotely, which means they do not have to commute to work. Unfortunately, the amount of existing homes rose far less. Additionally, the report included data regarding the supply of new construction homes for sale. The inventory for new construction homes for sale declined 28.4%. This is the largest drop in roughly seven years. The inventory in existing homes also declined quite a bit. Thanks to this shortage, newly built homes now represent 1 out of 5 houses for sale. This is the first time in history that new construction homes have dominated the for-sale market.
WHAT DID EXPERTS SAY ABOUT THIS?
Sheharyar Bokhari, Redfin senior economist, stated “The shortage of both new and existing homes is intensifying across America right now as record-low mortgage rates drive more demand, but the shortage of new homes is less severe due to a surge in construction right before the pandemic. As a result, sales of new homes are growing faster than sales of existing homes. Sales of new homes are also on the rise because the coronavirus pandemic is fueling interest in the suburbs—where there tends to be more space to build new homes.”
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