Tri-Cities Facing Housing Shortage

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Story Published: May 15, 2009 at 5:32 PM PST

By Holly Zuluaga

TRI-CITIES--The Tri-Cities housing market has been sheltered from the national trends, but it's facing a new problem.

There are too many buyers, but too few houses.

“We're very strong economy wise and we're one of only 27 cities that haven't been in a recession,” Paul Roy from Coldwell Banker said.

Nationally there are too many houses for sale and not enough buyers, but Roy says it's the opposite in the Tri-Cities.

“We're not able to keep up with the demand, we're seeing our inventory levels go lower and lower and lower and they're getting to where they get to critical level,” Paul Roy said.

It's a chain reaction to the national market and the credit crisis; banks have made it tougher on builders wanting loans, so they aren't building homes.

“If that trend doesn't change, meaning if the lenders don't loosen up the lending practice, we're going to have a housing shortage and that's where we are trending,” Paul Roy said.

That's a problem, because when there's a shortage, prices shoot up, and people can't afford to buy.

It boils down to this: a 6 month inventory of housing supply is best for a balanced market.

There is just under a 4 month supply for homes that cost $150,000 or less.

That means they’re 280 homes short, and it doesn’t look like it’s getting any better.

“Even if builders could go out today and get loans it's going to take them 6 or 7 months before they can ever build,” Paul Roy said.

Roy says as each month passes they get closer to critical, and it's the future they're worried about. All they can do is hope banks will take notice and not punish a thriving economy, or they will eventually run dry.

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