When an irresistible force like housing demand confronts an implacable barrier like ever-tightening inventory shortages, the pressure will grow until something has to give. In the case of our current unstable housing market, the only emergency steam valve that can relieve the bursting pressure is soaring prices, and the biggest loser is affordability. Until either supplies improve substantially or demand withers, rising prices will keep pushing upward, far beyond income levels in some markets. With each passing month this season, another metric of the housing economy falls victim to the dysfunction caused by the three-year inventory drought. In April, sales took a blow as lack of supply left buyers with not much to buy. In May, prices soared. “Home prices keep chugging along at a rate that is mot sustainable in the long run,” said Lawrence Yun, chief economist for the National Association of Realtors (NAR). May Market Reports at a Glance Source Monthly Sales …
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