Just released today: existing home sales have dropped again.
This isn’t, and shouldn’t be, a huge surprise.
What is a bit interesting is the increase of listings. More people are trying to sell their homes, fewer of those homes are in fact being sold, and we now have the largest inventory of homes for sale since October 1991.
People will often list their homes for sale when they first recognize that they can no longer afford to make the monthly mortgage payments. With access to home loans significantly restricted; and unable to refinance into a more attractive loan, homeowners are left with few other options then to try and sell their house.
However, with this increase of sellers into an already-crowded marketplace, competing for fewer and fewer finance-worthy buyers, we should see additional downward pressure on home prices. And when these sellers are unable to find purchasers, a number will fall into foreclosure – and foreclosure rates are already at record levels.
The housing slump isn’t over. Not by a long shot.