by Rob Wicker
Seems like the real estate market just keeps bouncing along the bottom and we’ll never see an upturn.
However, consider this: There are currently 3.65 million unsold existing home in the US. Three years ago there were 4.58 million. Even though it may not seem like it, housing inventory is gradually declining.
There is also a lot of pent up demand for housing. Young adults are graduating from college and moving in with their parents. Retirees are waiting until their home appreciates before they sell and move to Florida or Arizona. Couples are staying married because they are upside down and can’t afford to get divorced!
We’ll eventually reach a more balanced housing market where there is a 5-7 month supply of homes. Prices will stabilize and then begin to edge up. Then this pent up demand will take over and the market will be back. Sounds rosy but Warren Buffett, among others, agrees with this scenario.
As Franklin D. Roosevelt said, “When you reach the end of your rope, tie a knot and hang on.” Better days are ahead.