Le Tour De Housing Market
One of my favorite aspects of the Tour De France is the race through the Pyrenees. For several days, riders struggle mightily through tremendous mountain climbs in an effort to win the coveted yellow jersey and hopefully cement themselves as a legitimate contender to win the Tour.
For the past few years, our housing market has been challenged by a real estate ride through the Pyrenees. Rapidly growing inventories (see chart) created a steep mountain climb that home sellers and real estate agents had to navigate in an effort to get their homes sold. And, like the riders on the Tour, many fell short of achieving their goal.
Looking at what lies ahead, it appears the regional real estate market is approaching the end of the Pyrenees, leading to more modest hills on the horizon. Over the past several weeks, new listing activity has declined significantly and the total inventory of homes for sale is nearing its concluding peak. In fact, for the first time in years we expect to soon be reporting that listing inventory has actually declined as compared to one year earlier.
This recent phenomenon, the result of a combination of declining seller activity and growing buyer activity, will gradually shift our market back in the direction of a balanced market, meaning supply and demand will be cycling at a complimentary pace.
Yes, it will take us a while yet to get to the finish line, meaning the eventual balanced market. Nonetheless, it is encouraging news that we appear to be moving out of the mountains, into the hills and ultimately, on to smoother real estate roads.