The Double-Edged Sword That Is Rising Housing Starts
By Bob Phillips, CDPE, SFR, South Orange Co., CA
(Realty ONE Group)
After being range-bound since the start of the year Housing Starts unexpectedly jumped in May, surprising analysts and Wall Street. It's the latest in a string of housing-related data that suggests a real estate recovery is already underway. Housing Starts is an important statistic for a number of reasons, but to homebuyers and home sellers, its immediate impact is on home inventory. Home values are based on supply and demand. When the demand for homes exceeds the supply, values tend to rise. Conversely, when supply exceeds demand, values tend to fall. When Housing Starts increase as they did in May, therefore, unless there's a corresponding increase in demand, home prices get pressured downward. Lately, that off-setting demand appears to be present. With home affordability near record-...