Is Rising Inventory a Red Flag? Not Exactly.
You might’ve heard that the number of homes for sale is hitting a recent high—and we get why that might raise some eyebrows. But before you start thinking we’re headed for another 2008-style crash, let’s take a closer look at what’s really going on in today’s housing market.
Spoiler alert: more inventory doesn’t mean doom and gloom. In fact, it’s exactly what the market needs.
What’s Really Happening With Inventory?
According to the latest numbers from Realtor.com, housing inventory has just hit its highest level since 2020 (see white line in graph below).
But here’s the catch: we’re still nowhere near the pre-pandemic inventory levels (see in gray). That means while there are definitely more homes for sale than we’ve seen in recent years, the overall supply is still historically low.
So yes, inventory is going up—but we’re far from having too many homes on the market. And that context matters.
Why More Inventory Isn’t a Bad Thing
When people hear that inventory is rising, some can’t help but flash back to 2008. But today’s market is not even in the same ballpark.
Here’s the major difference: back then, we had a surplus of homes. Today, we’re dealing with a shortage—a pretty massive one, actually.
Take a look at the red bars in the graph below. They show the years since 2012 when new home construction didn’t keep pace with the number of households being formed (see graph below). The deeper the red, the bigger the shortfall.
Builders have been playing catch-up ever since. And now? The U.S. is short millions of homes. Realtor.com recently put it into perspective:
“At a 2024 rate of construction relative to household formations and pent-up demand, it would take 7.5 years to close the housing gap.”
That’s huge. So even though inventory is rising, we’re still not meeting demand in most markets—including right here in Massachusetts.
Bottom Line
So what does this mean for you? Don’t let national headlines shake your confidence. This isn’t the start of a crash—it’s a long-overdue step toward a more balanced, healthier market. More homes for sale means more opportunity and less pressure on buyers, and that’s something we all benefit from.
