Months of Inventory

If there is one thing people should know about the real estate market, is that they should know if the market is in a buyer’s, or seller’s market. While the most accurate definition of these markets depends on supply (inventory) and demand (number of active buyers), the industry has agreed that 6 months of inventory is a simple and informative reference point. In other words, if no new houses get listed after today, Months of Inventory is the number of months that the current number of active listings would last given the recent number of sales (average over the last 12 months). We added on our graph a dashed line at the 6 months of inventory mark to visually separate the two markets. Despite the fluctuations, this graph clearly shows how the real estate market in Media PA has been a strong seller’s market roughly since October 2015. While we do know that the market started to shift from a buyer’s market to a seller’s market in 2012, we do find this graph to be accurate in terms of when the market became heavily one sided, in favor of sellers. What is also noteworthy is that the inventory continues to drop while sales continue to be steady, as we have shown in one of our previous posts, causing the months of inventory to continue to drop in our local market of the greater Media PA area. To learn more contact Tony and Leen Salloum at tony@affinity.realestate, or 215-285-6435.

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