Scarcity: The State of Being Scarce or in Short Supply; Shortage

Scarcity -scar·ci·ty - noun: “the state of being scarce or in short supply; shortage.”

Do you remember back about two years ago when we all first realized what the pandemic was going to do to our everyday lives? I remember that grocery stores were overwhelmed and everything from fresh food to toilet paper became very scarce. It seems that the public was afraid of missing out on supplies and so we all stocked up.

Today’s real estate market has a scarcity of homes being offered for sale. Part of the reason is the scarcity of building materials needed to build new homes, so everyone is focused on buying existing homes, which tends to lead to even greater scarcity.

Scarcity is not always a bad thing. Think about gold and diamonds. These items are relatively scarce which directly leads to their higher prices. If they were as common as aluminum, they wouldn’t command nearly the same price.

Buyer demand has remained strong, perhaps for the same reason we flocked to the grocery store at the beginning of the pandemic; we all had the fear of missing out.

Some buyers have stepped out of the market hoping that prices will come down, but that is not likely to happen unless there is another recession, which is also not likely to happen in our lifetime.

Homes and condos are a little scarce right now, and so naturally, their value is climbing. It won’t always be the case. As values increase, more sellers will see this as an opportunity to sell, adding more inventory to the market. Then, prices will level off. Eventually, as supply chain problems are resolved, new construction will make a comeback, further balancing the supply and demand.

I hope you enjoy this issue of the Gambino Home Guide, and if you know of anyone who wants to get the best possible price for their home, we would be honored to show them the current value of their home in today’s market.

Jonathan R. Krause, President, Gambino Realtors

815.282.2222 | www.GoGambino.com