MINT HILL, NC – It’s not hard to see how the housing prices are skyrocketing. However, it’s time to stop blaming the pandemic from 2020 and look at the real reason housing prices are going up so fast.

Sure, the pandemic had something to do with it, but there’s more to it than just what happened in 2020. A rise in demand and a rise in the money supply has made the market go pretty much bonkers.

Many first-time buyers are trying to find a home, while several others are looking for a new, larger home, too. While many people want to buy a home, many also think they will never get to, due to the high prices.

Low Inventory Causing High Prices

Just like basic economics, the low housing inventory and growing demand have caused higher prices. When supply is low of anything and demand is high, it tends to send prices up.

While this is the easy explanation of why prices are going up, there is more to it. Of course, the 2020 pandemic sped up the process and threw the market into turmoil. However, prices are still going up two years later due to a low inventory, a high money supply, and plenty of demand.

Investors are buying more homes, too. This is causing the supply to dwindle for other buyers. In fact, investors bought about twice as many homes in 2021 compared to 2019. Part of this is due to the rise in short-term rentals across many markets in the United States.

Landlords also have been buying more homes due to tax breaks. Investors tend to get huge tax breaks that live-in owners cannot access. These government incentives have helped to make the real estate boom happen and have also helped contribute to busts over the years, too.

The Unspoken Secret the Real Estate Industry Won’t Tell You

When you look at the solution the real estate industry puts forward, there is something they don’t want to tell you. The industry will say, just build more homes and it will help prices go down. What they are really saying is, that they cannot stop the soaring home prices. Adding more homes to the inventory might help a little, but this ignores the rest of the equation.

With investors buying more homes, building more new homes isn’t going to help much. Very few homes are coming off the market unsold. This is not common and as long as investors are getting huge tax breaks, it’s going to be difficult for other buyers.

I would love to be part of your journey when the time is right for you. If you ever have a real estate question or need, or know someone who does, trust that you can turn to me.  I will help you make the right move! Anna Granger (704) 650-5707 | annagrangerhomes@gmail.com | www.1stchoicepropertiesinc.com