The absence of adequate homes for sale in any property market adheres to demand and supply laws, ending up in a higher price for each unit. Nonetheless, what may lead to low housing stocks while there are many prospective home buyers out there? According to Jeff Rutt from Keystone Custom Homes, below is how to explain low housing inventory:
For someone to be able to sell a home, the need to have sufficient equity on the property. Yet, statistics indicate that 20% of homeowners that are yet to fully repay their mortgage do not have sufficient equity on their homes to sell, Jeff Rutt asserts. Due to these homes not being ready for sale, you should expect a low housing supply.
Counting on Profitability
In the event that many individuals would be inclined to sell their homes, but they won’t do it since it’s impossible for them to make profit now, you certainly expect a shortage in real estate listings. About 10 years ago, millions of homes were bought at the peak of the property boom. Very many people that purchased properties at that time are to date waiting for the right moment to make profit, even if their mortgages are not underwater. That’s another reason for housing shortage that leads to higher prices.
Buyers’ Hold Off
Obviously, nobody would build homes for sale when a lot of buyers are holding off, and that can impact on housing supply. According to builder jeff rutt, factors such as price instability and inadequate supply of homes have pushed buyers, who drive the market behind the scenes, to push back their buying plans.
The Perks of Owning Investment Real Estate
Many people are raking in good returns as landlords from the impressive rental income they receive each month. Similarly, there’s the potential for properties to soar in value, attracting a better selling price in future. Therefore, persons that purchase residential investment properties, for instance single-family homes, are not likely to list these properties in the near future. Again, that’s a factor to explain low housing inventory. Learn more at http://www.britannica.com/EBchecked/topic/83859/building-construction.
Insufficient Property Developers
Jeff Rutt from Keystone Custom Homes asserts that the unavailability of enough home builders is tied to the low housing supply phenomenon. It just happens that the 2007 economic meltdown led to the closure of many smaller property developers, with those surviving being forced to sell off their inventories of prime land set aside for future development.
If you go through reviews of Jeff Rutt from Keystone Custom Homes now, you’ll notice that he’s been taking part in the construction of superior quality residential properties from scratch according to plans approved by owner. Read jeff rutt blog here!