A new report by CoreLogic shows the inventory of homes for sale in the U.S. increased in March with 4.5 months’ supply of homes, which is historically one of the lowest numbers recorded.
Although March’s figure is an increase year-over-year from March 2018’s 3.5 months of inventory, it was less than half of what it was 10 years ago—9.1 months of inventory.
“Not only is new construction and mobility--two traditional drivers of inventory--at low levels, but some potential inventory shifted to the rental market over the past ten years,” the report states.
The report states that the rental share of listings following the foreclosure crisis of 2011 has been steadily increasing, despite seeing a slight drop so far in 2019. The rental share in March dropped to around 12% from nearly 14% in March 2018.
The share of rentals listed in March 2011 was around 9%.
CoreLogic states the average rate for rentals shares in the top-48 metros was 12.1%, but found rental rates are higher in areas that are growing, or were hit harder by foreclosures.
Boston, Massachusets, had a rental share of nearly 25%, which is the highest among the top-48 metros. Miami, Florida; Austin, Texas; Philadelphia, Pennsylvania; and Honolulu, Hawaii, followed and had rental shares of more than 20%.
Dallas, Texas, had the 10th-highest rental share at 15%.
Having a high rental share doesn’t equate to having a large overall housing supply, CoreLogic stated, adding the rental market in many regions has low inventory. Miami had the highest overall inventory, with nearly seven months’ supply of rental inventory and 11 months of for-sale supply.
While CoreLogic is painting gloom image regarding housing inventory, RE/Max’s National Housing Report for March showed a brighter picture.
RE/MAX’s report found inventory increased month over month in March by 0.3% from February 2019 and up 5.3% from March 2018. RE/MAX estimated that, given the Rate of Sales data, the Months Supply of Inventory decreased to 2.7 from 3.7 in February 2019, and from 3.0 in March 2018.
Inventory got a slight boost going into April, as residential real estate building permits increased month over month according to the latest Residential Construction Report from the Department of Housing and Urban Development (HUD) and the U.S. Census Bureau.