by Wolf Richter
Now they’re wondering why.
Home prices skyrocketed by the double digits starting last summer, despite the loss of 10 million jobs still, and with 2.5 million mortgages still in forbearance, as mortgage rates dropped from historic low to historic low. People bought homes without putting their old and now vacant home on the market because it’s profitable to hold it, amid surging home prices and low interest rates and the possibility of yanking cash out of the old house via a refi. As homes got grabbed and sales surged, other homes weren’t put on the market, inventory for sale plunged, and prices surged. But now, sales have turned from a preliminary dip late last year to a big drop in February. And everyone is wondering why.