Explaining Low Housing Supply: A Jeff Rutt’s Perspective
The absence of adequate homes for sale in any property market adheres to demand and supply laws, ending up in a higher price for each unit. Yet, what would cause a shortage of housing supply when there are many people seeking to buy? Let’s see Keystone Custom Home’s Jeff Rutt try to explain low housing inventory below:
To be eligible to sell a property, a person is expected to have a higher stake in its ownership. However, studies suggest that 20% of people still paying their mortgage have not acquired enough equity on their real estate to be able to sell. Because such properties have not yet entered the market, you may anticipate a level of shortage.
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Waiting to Sell for Profit
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When a lot of people don’t have an issue with selling their property except for the fact that the timing is not right to make profit, you’re going to have less homes on sale in the property market. Millions of properties were purchased approximately 10 years ago when the housing boom was at its peak. A lot of people that bought properties during that time are still waiting for the perfect timing to make profit, including when there are no underwater mortgages. That’s another reason for housing shortage that leads to higher prices.
Lack of Buyer Interest
For sure, only a couple of properties would be built in the wake of reduced buyer enthusiasm, and that does influence housing inventory. As per Jeff Rutt, issues like price fluctuations and lack of enough homes have resulted in buyers, who subtly influence the property market, holding off their aspirations to buy.
The Allure of Keeping Investment Properties
A lot of people are making good money as landlords due to the lucrative rental fees they get every month. Likewise, there’s the possibility of properties appreciating in value and fetching a greater selling price later. So, people that buy residential investment properties, such as single-family homes, are not likely to offer these for sale any time soon. Once more, that’s a way to explain low housing inventory.
Lack of Enough Builders
According to Jeff Rutt from Keystone Custom Homes, the low housing inventory issue may be explained by the lack of enough property developers. As a matter of fact, the 2007 financial crisis caused a lot of smaller home builders to collapse, and the few that endured resort to selling off their prime properties put aside for later development.
If you go through reviews of Jeff Rutt from Keystone Custom Homes now, you’ll notice that he’s been taking part in the construction of superior quality residential properties from scratch according to plans approved by owner.