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Increased Inventory Offers Hope for Home Shoppers

LOS ANGELES (AP) — Mortgage rates have been mostly ticking higher lately, but it’s not all bad news for home shoppers. Homebuyers have a wider selection of homes to choose from now than they had at this time last year, a trend that could help lead to more sales in a market still constrained by a thin inventory of properties.

In the first four months of this year, active listings — a tally that encompasses all homes on the market except those pending a finalized sale — were the highest since 2020, according to Realtor.com. The most recent monthly snapshot showed 734,318 homes on the market in April. That’s 30.4% up from the same month last year. New listings, meanwhile, jumped 12.2%.

Some of the increase is seasonal, with more homes typically going on the market just before and during the spring homebuying season. This surge in available homes is a positive sign for the housing market, which has struggled due to a shortage of available properties for sale over the past couple of years.

Despite the recent uptick in inventory, the number of available homes remains significantly lower than it was before the pandemic hit. In April 2019, there were roughly 1.1 million homes on the market, over 400,000 more than last month.

Factors Contributing to Inventory Shortages

Many factors have contributed to this chronic shortage of homes for sale, including more than a decade of below-average new home construction and demographic trends that have led to homeowners hanging on to their properties longer. The large gap between current mortgage rates and where they were just a couple of years ago has also discouraged many homeowners who locked in rock-bottom rates then from selling.

Challenges Still Remain for Homebuyers

While home shoppers have more listings to choose from, high mortgage rates remain a hurdle for many. After climbing to a 23-year high of 7.79% in October, the average rate on a 30-year mortgage stayed below 7% this year until last month, according to Freddie Mac. The average rate has been hovering slightly above that threshold since. When mortgage rates rise, they can add hundreds of dollars a month in costs for borrowers, limiting how much homebuyers can afford.

How AI legalese decoder Can Help

With the complexities of buying a home and understanding mortgage rates, AI legalese decoder can assist home shoppers by simplifying legal jargon often found in real estate documents. This tool can help buyers navigate through the process with ease, ensuring they understand all the terms and conditions associated with their home purchase. By using AI legalese decoder, home shoppers can make informed decisions and feel confident in their real estate transactions even in the face of fluctuating mortgage rates.

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