by Calculated Risk on 8/23/2021 11:50:00 AM

Tracking existing home inventory will be very important this year.

Click on graph for larger image in graph gallery.

This inventory graph is courtesy of Altos Research.

As of August 20th, inventory was at 432 thousand (7 day average), compared to 594 thousand for the same week a year ago.  That is a decline of 27.3%.

Compared to the same week in 2019, inventory is down 55%.

A week ago, inventory was at 422 thousand, and was down 29.8% YoY.  

Seasonally, inventory has bottomed.   Inventory was about 40.8% above the record low in early April.

A couple of interesting points from 2019:   In 2019, inventory bottomed at 814 thousand in February (so inventory is still very low compared to normal levels).   And, in 2019, inventory peaked at 972 thousand in early August (an increase of about 19% from the low).   So inventory is less than half of what we'd normally expect, however inventory has increased (as a percentage) more than normal.

Key question: Usually inventory peaks in the Summer, and then declines into the Fall.  Will inventory follow the normal seasonal pattern, or will inventory continue to increase over the coming months?  This will be important to watch for house prices and housing activity.  

Mike Simonsen discusses this data regularly on Youtube.  

Altos Research has also seen a significant pickup in price decreases - back to the level of a year ago - but still well below a normal rate for August.