The Moguldom Nation, August 4, 2021, Housing Boom Slows Down As Buyers Pull Back From Inflation And Bubble Prices
Along with a growing supply of housing inventory to meet the massive demand, the boom in home sales appears to be slowing down as rising real estate prices — some, up by double digits — make new homes unaffordable for many people.
Based on the frenzied buying and price gains of the past year, analysts were expecting new home sales to increase by 3.4 percent in June, CNBC reported. Instead, sales of newly built homes fell by 6.6 percent from May to June — the lowest level since April 2020, according to data released Monday by the U.S. Census Bureau.
The median price of a newly built home in June increased 6 percent from June 2020, and while that is a large gain, it is small compared with the 15-to-20-percent annual gains seen in previous months. Inventory of new homes for sale spiked from a 5.5-month supply in May to a 6.3-month supply in June.
With inflation and the skyrocketing price of building supplies such as lumber, builders can’t afford to put up affordable homes, according to CNBC. Most of the home buying is on the higher end of the market.
