How many months of inventory is a healthy, balanced market? Just want to see how many people know the correct answer.

Asked by Doug Holmes, Charleston, SC Wed Oct 20, 2010

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14
Tina Hagen, , Isle of Palms, SC
Sun Oct 24, 2010
BEST ANSWER
Six months is considered healthy. and balanced.

What, oh things are still not back to normal yet? In some areas and price points we are looking at a three year supply. This is mainly in what I will call the luxury market. If the houses were jeans sitting at Bloomingdales the merchandise would have been marked down long ago, to make room for new product.

If the product sold in three weeks, and the store no longer had jeans to sell there would be a pent up demand and desire for jeans. Bloomingdales could now sell them for more.


What can I say, I know inventory and Bloomingdales was one of my customers.
0 votes
Daniel Fisher, Agent, Charlotte, NC
Fri Mar 15, 2013
Good afternoon, Doug:
A balanced market’s absorption rate is typically between 5 – 7 months. There is a good discussion on http://www.realtor.org/RMODaily.nsf/pages/News2007111404 If you appreciate an answer, please give thumbs up. For the most helpful answer, please say thanks with a best answer click.
1 vote
Joanie Willi…, Agent, Paso Robles, CA
Thu Feb 14, 2013
Here in Paso Robles, California, we have 2 months of inventory. What is going on? I know the rest of the country is having a tough time finding buyers, while we are having a tough time finding sellers. I imagine that in time, things will balance out nationwide. I hope so.
1 vote
Phoenix at 2.1 months right now! 8/2016
Flag Thu Aug 11, 2016
In Westlake Village area., we are down to 3 months inventory.....
Flag Mon May 4, 2015
Jessica Hood…, Agent, Gambrills, MD
Wed Jan 5, 2011
I would say that three months is going to give you the healthiest market on maintaining level prices (not a lot of negotiating on relatively new listings) for both buyers and sellers.
1 vote
Mack McCoy, Agent, Seattle, WA
Wed Oct 20, 2010
How do we know that you're right?
1 vote
Maggie Hawk, Agent, New Smyrna Beach, FL
Wed Oct 20, 2010
Doug,
A 6-month inventory is considered normal. Less than that is a Sellers' market, and more is a Buyers' market.

Right now, in my area (Florida's east central coast), there is a 24-month inventory of homes waiting to sell. On the positive side, Buyers have a great selection.

I want to share with you a chart that depicts (national) housing inventory from 2001 to the present. If you're a fan of Mel Brooks, you'll love the quotes. (Even if you're not, the statistics say it all.) Thanks again for putting us to the test.

http://theburningplatform.com/blog/tag/home-inventory/

Warm regards,
Maggie Hawk, REALTOR
Watson Realty Corp.
1 vote
Cheryll Wood…, Agent, Mount Pleasant, SC
Wed Oct 20, 2010
Dear Doug,

3 - 6 months of listing inventory would be considered a healthy market. Oh...the good old days!

Have a fantastic afternoon!

Best regards,

Cheryll Woods-Flowers, Keller Williams Realty
cflowers@woodsflowers.com
843-442-2219
http://www.woodsflowers.com
Web Reference:  http://www.woodsflowers.com
1 vote
Vicky Taylor, Agent, Dekalb, IL
Fri Mar 8, 2013
6 months I do belive would be a healty balance for the market. There are counties here in Ga that are about 3-4 months of inventory.
0 votes
Liane Jamason, Agent, Saint Petersburg, FL
Thu Feb 14, 2013
6 months is balanced. More is a buyer's market. Less is a Seller's Market.
0 votes
Liane Jamason, Agent, Saint Petersburg, FL
Tue May 17, 2011
Here in Tampa Bay we've just returned to 6 months of inventory, and although prices are still low - they are climbing slowly and inventory is shrinking.
Web Reference:  http://www.lianejamason.com
0 votes
Jeff Bowers, Agent, North Charleston, SC
Wed Oct 20, 2010
4 -6 months would be a good balanced inventory of homes.

Jeff Bowers,CRS
RE/MAX Pro Realty
843-442-1208
Web Reference:  http://www.JeffBowers.com
0 votes
Shawn Pillion, Agent, Charleston, SC
Wed Oct 20, 2010
Five months would be a perfect balance for Charleston....
0 votes
The Charlest…, , Charleston, SC
Wed Oct 20, 2010
Buyer's Market - more than 7 months of inventory.
Seller's Market - less than 5 months of inventory
Balanced Market - from 5 to 7 months of inventory
0 votes
Lisa Cannata, Agent, Falmouth, MA
Wed Oct 20, 2010
Four to six is a healthy balance.
0 votes
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