The inventory of single‑family new homes in the United States is accelerating, with May’s monthly supply rising 10.3 months higher than the previous month – the highest level since February 2009. This index shows how long it would take to sell all homes on the market at the current pace. A higher index indicates weaker demand relative to supply.
Historically, the median long‑term level of the index has been about 6.0 months. Since the 1970s, the U.S. economy has entered recession in six of the seven times the index has reached its current levels.
High mortgage rates and unprecedented home‑ownership costs have pushed buyers away, leaving builders with a surplus of homes that are difficult to sell. The U.S. housing market has rarely faced such a large oversupply.