You don't need to be an economist to understand supply and demand. It's a pretty simple concept. When supply is low and demand is high, prices rise. That's what's been happening in the housing market. Home prices have been increasing because a lot of people want to buy a house but there aren't a lot of homes available to buy.
Fortunately, though, there's reason to believe the inventory crunch that's pushed prices higher may be starting to ease. According to a new report from the National Association of Realtors' consumer website, the number of active listings – while still low – has showed improvement. In February, listings were 25 percent lower than one year earlier. That's down from 28.4 percent in January. Additionally, the last two weeks of February saw more new home sellers enter the market than during the same period in 2021. In fact, the final week of the month saw new listings rise 2.1 percent over year-before numbers.
While the gains may seem small, they're an encouraging sign for buyers, since the number of listings will likely grow as the spring sales season gets underway.
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