Additional inventory growth is expected in July, building on accelerated improvements seen throughout June. Even more homeowners could decide to sell, adding new supply as buyers grapple with higher costs and difficulty finding homes that fit their budgets.
Still, the expanding supply is not easing sky-high home prices yet. The median listing price in June hit another record high of $450,000 according to Realtor.com. Annual gains are moderating slightly, but still up almost 17%. That’s partly because the share of larger, more expensive homes is rising.
Lenders generally see a 28% debt-to-income ratio as the ceiling for approving a mortgage. It’s why some potential homebuyers today are no longer qualifying for a mortgage.
A few factors could thwart the continued growth in inventory levels, including a pullback from potential sellers who might decide to wait for the market to strengthen again. Still, according to Realtor.com, new and pending home sales were up this month, so some people might feel now is time is right to buy.
As expectations of higher future mortgage rates rise, today’s home shoppers could be more motivated, especially now that they’re seeing more options to choose from.
