U.S. housing supply hit by historic shortages: NAR

Yahoo Finance's Sibile Marcellus joins Akiko Fujita to break down the latest housing data as the U.S. faces a historic housing supply shortage.

Video Transcript

AKIKO FUJITA: Well, the lack of inventory for new homes on the market pushing housing prices even higher, at a time where we've seen relative resilience in the housing market, even in the face of the economic downturn. Let's bring in Sibile Marcellus to break that down for us. And Sibile, we've heard so many of these stories of bidding wars that are breaking out in some of these really hot markets because there just aren't enough homes on the market right now.

SIBILE MARCELLUS: That's right, Akiko, So there was already a supply issue in the housing market prior to the coronavirus pandemic, but now it's been exacerbated even more by the pandemic. And what we're seeing, is that many Americans are realizing that they're going to be working from home for a much more extended period of time, so they're considering having a new home. Some are considering buying a house for the first time. And what they're finding, is that in their search, the housing market, there aren't that many homes that are actually on sale. We're talking about homes that already have owners that people would like to purchase.

So when you look at the numbers, look at the data from the National Association of Realtors, they're seeing that at the end of July, there were 1.3 million single family homes on sale. But when you compare that to previously, we haven't seen numbers that low since July in 1982. So it really gives you a sense of how much there's a demand and also in terms of supply and how much that's limited.

And what we're also seeing, is that some people aren't putting their homes for sale, because they're also dealing with the financial devastation and losses from the coronavirus pandemic. They can't afford to move into another home. So that's also contributing to the reason why we're seeing such historic short supply of homes on sale.

AKIKO FUJITA: Yeah, and Sibile, we've also heard about how inventory is likely to tick up. Because when you think about a lot of those homeowners who potentially were not able to pay their mortgage, there has been a moratorium in place. That's kind of like kicking the can down the road. Can we expect additional homes to come on the market as a result of that? What are you hearing on that front?

SIBILE MARCELLUS: Well, we'll have to see how the economy pans out, right? Because some homeowners, they're in a situation where they can't sell their home because they're dealing with financial losses from the coronavirus pandemic, whether that's being laid off, having lost their job. So they don't really have another place to go. So they're going to stay put.

But you also see some home owners who are trying to get the best price possible for their home. So they're pushing the home price as high as possible. And what we're seeing, is that some people would like to purchase the homes, now it's no longer within their budget. So there's a couple different dynamics going on here in the housing market. But the big takeaway is the fact that supply is historically limited.

AKIKO FUJITA: OK, thanks so much for that, Sibile.