The latest read on surging American home prices comes Tuesday from the S&P/Case-Shiller Home Price Index. But recent increases are not because buyers are abundant and excited. For the moment, weak supply is driving the spikes more than strong demand. Here’s why supply is low:
1. Developers are building more rental apartments, which means fewer new homes on the market.
2. Some current homeowners who would like to sell aren’t putting their homes on the market. Many families can’t qualify for mortgages under today’s stricter lending standards, which means they’re staying put instead of selling and trading up.
Click the media player above to hear more.
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?