Home sales are rising, so why isn’t inventory going up?
Between 2012 and 2015, home sales have increased by almost 600,000 units, from 4.67 million units to 5.25 million units, while housing inventory has been flat or down. Existing home sales are up 5 percent year over year in the first half of 2016, and in June reached a seasonally adjusted annual rate of 5.57 million units―the highest level since early 2007. But housing inventory, as measured by the number of existing homes for sale, was down by 130,000 units year over year in June. It appears rising home sales and flat-to-down inventory trends are consistent with more first-time home buyers entering the housing market, and when these buyers enter the market, they add to sales without also bringing inventory to the market.