Fratantoni predicted a year-over-year increase in sales for used homes, while stressing that first-time home buyers were still being edged out of the market. “With inventory at only 2.4 months’ supply, and median home prices increasing nationally at 13%, it was not surprising to see the first-time homebuyer share of the market drop again to 28%.
“Depressed inventory levels continue to constrain the market, but MBA still forecasts for existing sales to come in at an annualized pace of 6.07 million this year – a 7% increase from 2020.”
Fratantoni also said the MBA expected new home construction to help support growing inventory levels in the run-up to 2022, “which will lead to a deceleration in home-price growth”.
In an unexpected fillip for first-time homebuyers, he added: “Demand is strong and wage growth is healthy, and first-timers will have better chances to reach the market as inventory increases.”
The view that inventory would increase in the coming months was shared by Yun, who said more homes would appear on the market “as soon as 2022”, as mortgage forbearance programs ended and homebuilders ramped up production, “despite the supply-chain material issues”.