Even as days on the market are lengthening, overall housing inventory still remains near historic lows. New listings are actually lower compared to the same period a year ago. That means once the gate opens a bit for homebuyers, we could again face a housing shortage. This is why more new home construction is needed, as well as more rehabilitation of disused buildings into residential units.

Housing starts in October fell to 1.425 million annualized units, implying we may face shortage conditions. Apartment buildings remain robust, with a 17% gain from a year ago, but single-family starts are 21% below one year ago and well below historical averages.

In the meantime, mortgage rates are falling from the peak levels of last month. The gate is opening for more homebuyers to qualify for a mortgage.

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