Lack of Home Inventory In The North Shore: Is It True?

Let’s start by clearing the air about a few things. The current events on the local, state, national, and global levels are enough to make one feel as though they are living in an alternate universe or trapped in a strange, sci-fi dystopian movie. We have challenges worldwide, in our nation, our state, and in our communities with respect to public health, safety, the economy, and now - housing.

Just when we thought that the market would be picking up in all the right ways, we are coming to the realization that the uptick we predicted we would see is not materializing. Homes are selling, yes, and in fact, they are doing so at almost record speed here in the past several weeks alone. What we are not seeing, however, is an upward trend in the volume of available homes for sale being listed. That means that we are on the brink of a true inventory shortage.

The data seems to be pointing to a surge of sales in the suburbs of Chicago, especially on the North Shore, with many of those buyers coming from the city of Chicago.

While Illinois is experiencing net population loss, the housing market is still functioning and was seemingly vibrant even despite the most recent adversities we have faced. Now, we are observing that the next obstacle the North Shore housing market will encounter is a shortage of homes for sale.

There are buyers out looking now who are ready, willing, and able to buy - and want to buy - who simply cannot find a property to fit their needs. For one, the number of homes in a given marketplace is much lower. For two, competition has increased.

The average North Shore community market was not likely to see a multitude of multiple offer situations a la HGTV portrayal akin to places like Los Angeles, Las Vegas, New York City, and Houston. Buyers don’t generally end up in bidding wars over properties, at least, they didn’t until very recently.

In the same way, that over-saturation of inventory can cause dramatic market shifts, so too can a lack of inventory. If there are more buyers who wish to purchase in a specific area than there are homes available to purchase buyers will have to expand their searches to other areas in order to secure housing.

So, while a lack of inventory on its face may appear to be creating a sellers’ market, that may not be all it is cracked up to be. What could initially cause a small surge in home prices and competition over homes will most likely lead to the ultimate downturn in sales as buyers are forced to reevaluate their buying plans.

The takeaway here is that neither extreme is beneficial for anyone. Too many homes on the market drive down prices and increase time on the market, which can be frustrating for sellers. If there are too few properties available for purchase, then buyers will turn elsewhere to make their dreams of homeownership a reality.

The Spaniak Team at eXp Realty is one of the top real estate teams on the North Shore. They have sold over 400 homes and $250 million in real estate in the past 8 years. Their contact information is info@spaniakteam.com 847-379-8813 spaniakteam.com.

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