As reported by the National Association of Realtors (NAR), existing home sales fell for the third straight month in April – and are now down 13.1% from their October 2020 peak.
The total inventory of homes for sale, on the other hand, rose to 1.16 million units in April – up 10.5% from the all-time low set in the previous month.
Are these early warning signs that the uptrend in the U.S. housing market may be weakening – and that prices are nearing a peak?
No, you can’t conclude that yet.
Those are short-term trends – and in real estate, investors should focus on longer-term trends to tip them off when to buy and sell.
Existing home sales, for example, were up 33.9% from a year ago – which means more price appreciation is likely.
Similarly, the total inventory of homes for sale were down 20.5% from one year ago – which also foretells of continuing price appreciation.
Rising housing markets are born, grow old, and die.
While most investors willingly believe what they want to believe, the fat lady hasn’t started to sing yet.