Wednesday, June 18, 2014
Fifty years of data says, house prices lead housing inventory for sale
- by New Deal democrat
Several years ago, Barry Ritholtz wrote a 5-part series on why housing prices weren't bottoming (hey, nobody's perfect). One of his arguments was that any uptick in prices would bring out such an increase in listings that prices would actually fall further.
I have a post up at XE.com looking at the relationship between house prices and the number of houses listed for sale. The bottom line is, prices lead listings, as potential home sellers take their cues from recent price movements, but it takes a while for the "message" to get through to them.
Since we may be at an inflection point for house prices, this is a relationship we can watch.