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The Hidden Truth Behind the Housing Market: It’s All About Inventory
Recent survey results from Veterans United Home Loans have revealed some interesting insights into the current housing market. According to the survey, 60% of prospective buyers are considering the upcoming election in their home-buying decisions, with 38% even pausing their search until after Election Day. While these numbers might seem shocking at first glance, they distract us from the real issue at hand: affordability.
The survey also shows that 25% of civilians and 40% of veterans plan to buy a home in the next six months. However, the harsh reality is that many of these potential buyers, especially veterans, may struggle to afford homes at current prices and with their salaries.
Interestingly, when asked about their financial situation compared to a year ago, 63% of veterans and 59% of civilians reported feeling better. These numbers are higher than last year, but one has to wonder how these sentiments might change after they start house hunting in earnest.
The crux of the matter is this: if we can address affordability by lowering prices, reducing interest rates, offering concessions, and making homes actually attainable for people, buyers will come. It’s a “Field of Dreams” scenario – build it, and they will come.
The real problem, the only problem that truly matters, is inventory. Everything else – surveys, polls, articles – is just noise distracting us from this fundamental issue. We need an equilibrium of adequate supply and demand, and the only way to achieve this is by increasing inventory and allowing prices to adjust accordingly.
So why aren’t we pushing for more housing construction? It would create jobs, solve our housing woes, reduce homelessness, and improve communities through increased home-ownership. The answer lies in the interests of big players like BlackRock, Vanguard, and State Street, who own a significant portion of the market. They, along with builders and current homeowners, don’t want to see existing home values decrease.
If we implemented solutions to increase inventory, headlines might read “Americans Lose $8 Trillion in Wealth” rather than “Home-ownership Rates Increase by 14%”. Which headline do you think would get a politician re-elected?
This is where real estate professionals come in. Loan officers, realtors, and brokers should be using these talking points in their marketing. By pushing for increased inventory and affordability, you can position yourselves as leaders in a movement that resonates with the average American. This approach can help you stand out in an increasingly competitive market dominated by hedge-funded tech alternatives and impersonal services.
Consider this: the total value of the U.S. housing market is now slightly less than $52 trillion, which is $1.1 trillion higher than the previous peak reached last June. It’s no wonder that Wall Street competition is digging its claws deeper into potential profits.
Despite the challenges, real estate professionals still have the numbers to overcome these forces – if we organize. It’s time for broker-owners to carry the torch and represent our industry. You have the numbers, the money, and the motive to do the right thing.
I’m calling on broker-owners, wholesale companies, non-banking platforms, and everyone else in the industry to look at this issue with open eyes. Start messaging those you have influence over. Write emails, start conversations, and begin the groundswell of change.
Remember, the only solution to our housing problems is increased inventory. Everything else is just window dressing. Let’s focus on what really matters and work together to create a more affordable, accessible housing market for all.
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