National Association of Home Builders CEO Jerry Howard notes that the housing supply shortage is driving increased prices for homes and argues it would be ‘much less inflationary’ if supply increases to about six months of houses on the market.
Pending home sales took a hit in April as the shortage of affordable housing remains a headwind for house hunters.
“Some buyers from the expensive cities in the West and Northeast, who have the flexibility to move and work from anywhere, could be opting for a larger-sized home at a lower price in the Midwest” Yun explained.
Recent data points on housing are showing the red hot market is cooling. Mortgage applications fell 4.2%, according to the Mortgage Bankers Association’s weekly survey. Interest in refinancing fell as well by 7% compared with the prior week.