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CHART OF THE DAY: As housing market heats up, inventory shrivels

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Existing home sales in August topped 6 million for the first time since 2006 as big-city renters continued to flock to the suburbs for more space, including a home office and a yard to accommodate their new normal.

The 1.27 million existing homes for sale represent a mere 2.8 months of supply.

Meanwhile, existing homeowners are hesitant to put their houses on the market, given uncertainty around the coronavirus pandemic and fears that they won’t be able to find their next house. Inventory is scarce, with only 1.27 million existing homes for sale, representing a mere 2.8 months of supply, according to data released on Tuesday by the National Association of Realtors. This market of rabid buyers and reluctant sellers has led to bidding wars, driving up the median existing home price to $310,600, an 11.4% year-over-year increase.

Source: National Association of Realtors

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About Troy Merkel

@troymerkel

Troy Merkel is a Partner and Real Estate Senior Analyst at RSM. He has 15 years of experience in audit and consulting, with a particular emphasis in real estate and financial services reporting, in accordance with US GAAP, IFRS, NCREIF PREA Reporting Standards and income tax basis. He is also an expert in accounting for asset acquisitions and complex leases and specializes in various tax-advantageous, in particular Opportunity Zones and government subsidized deal structures.

In 2018, Troy was selected as a senior analyst in RSM’s cutting edge Industry Eminence Program, which positions its senior analysts to understand, forecast and communicate economic, business and technology trends shaping the industries RSM serves. These senior analysts advise clients on conditions impacting middle market leaders. Troy’s focus is on the real estate industry.