“With this low inventory and buyers having to do everything they can to get these houses and not lose them, we’re essentially raising the value of these homes that organically would’ve taken years to happen,” Carnesi said. “The challenge with that is going to be affordability. At some point, when do homes start becoming unaffordable because of acceleration of appreciation and pricing?”
But buyers who are waiting for prices to drop could also risk seeing those savings erased if interest rates rise in the same period, said Mike Hills, vice president of investment brokerage for Atlas Real Estate Group.
“If prices drop 10%, but interest rates rise a point, your mortgage payment is roughly the same,” Hills said. “If inventory remains so freakin’ low, how is [the average price] going to drop 10%?”