Exploring Housing Supply Factors in 2023

As valued clients of the Bill McGarrigle Team, we understand the importance of keeping you informed about the factors that influence the housing market. In this article, we will focus on the current state of housing supply both nationwide and specifically within Chester, Montgomery, and Delaware counties. Additionally, we will highlight positive insights and opportunities in the local real estate market to enable you to make more informed decisions. Let’s dive in!

National Housing Supply Trends:
Across the United States, the housing market has experienced a combination of factors affecting housing supply. These include:

1. Inventory Shortage: The country has been grappling with a limited supply of available homes for sale, leading to increased competition among buyers. This scarcity has been primarily influenced by a shortage of new construction, high building material costs, and labor challenges within the construction industry.

2. Population Growth: The steady population growth in various regions has heightened the demand for housing. This increased demand, coupled with the limited supply, has resulted in a seller's market, allowing homeowners to potentially benefit from rising property values.

Housing Supply Factors in Chester, Montgomery, and Delaware Counties:
1. Strong Local Economy: Southeastern Pennsylvania has experienced robust economic growth, attracting businesses and job opportunities. This has contributed to an increased demand for housing, especially in desirable neighborhoods and school districts.

2. Limited Land Availability: Due to the region's proximity to major cities like Philadelphia and its appealing suburban lifestyle, land availability for new construction is relatively limited. This factor, combined with stricter zoning regulations, has further contributed to the existing inventory shortage.

Positive Insights in the Local Real Estate Market:
Despite the challenges presented by the housing supply factors, there are positive aspects to consider within the current real estate market:

1. Increasing Property Values: Limited housing supply, coupled with strong demand, has led to a trend of appreciating property values in the area. This presents an opportunity for homeowners looking to sell, potentially maximizing their return on investment.

2. Mortgage Rates: While the record-low rates of 2020 and 2021 are now a thing of the past, today’s mortgage rates are still relatively low from a historical standpoint. Freddie Mac — a main industry source for mortgage rates — has been keeping records since 1971. Between April 1971 and June 2023, 30-year fixed-rate mortgages averaged 7.74%. (Reference: The Mortgage Reports Article)

3. Competitive Advantage for Sellers: Sellers in the region have a competitive advantage due to limited inventory. Well-priced properties in desirable locations often attract multiple offers, resulting in favorable selling conditions.

4. Stable Rental Market: The tight housing supply has also impacted the rental market positively. Landlords have experienced increased demand, leading to stable rental income and potential investment opportunities.

As your trusted real estate team, we are here to guide you through these market dynamics. Whether you are considering buying, selling, or investing, we can provide you with personalized advice and market insights tailored to your specific needs. Please feel free to reach out to our team with any questions or concerns you may have. We are committed to ensuring your real estate journey is smooth and successful.