The housing market was still underperforming in February, according to the National Association of Realtors. With just a slight bump up from January, total sales are still running below expectations for the year. Don’t blame winter weather, though. Blame the lack of supply.
There are just 1.89 million homes for sale, which is down from a year ago and well below current demand. The number of listings from January to February historically rises about 6 percent, but this year it inched up less than 2 percent.
This is “all about inventory,” said Lawrence Yun, chief economist for the Realtors. “Smaller local builders are not in the game. They don’t have access to credit.”
Larger builders are catering more to higher-end buyers, and that leaves very little for lower-end, first-time buyers to move into. Move-up sellers don’t help, because the minute they sell, they buy, so the supply needle doesn’t move.