Housing inventory is scarce in the U.S. – the National Association of Realtors said there was a supply of about 4.6 months in June, compared with a typical supply of six months in a healthy market – which is leading homeowners to be more reluctant to sell their homes. The reason why, MarketWatch staffer Daniel Goldstein reports, is because they’re unsure where they’re going to live next.

Not only does the low housing inventory mean a bidding war for buyers, but sellers who may want to move to a smaller home and stay in the same market are quite often stuck -- because of the rise in prices for smaller homes that are being fought over by both first-time buyers and downsizing empty-nesters.

“A key part of the inventory problem is that in expensive markets it’s difficult for existing homeowners to find another home afterwards if they do sell,” said Ralph McLaughlin, an economist with San Francisco-based Trulia.com, a real-estate research firm. “It’s a double-edged sword.”

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