After noticing a sharp increase in the “Days on Market” metric, which can be an indicator of a cooling market, I called local real estate expert and author ofThe Valley of Heart’s Delight blog, Mary Pope-Handy, to see what was up.
As a home-buying company it’s important for us to stay on top of market trends, and that goes beyond understanding the quantitative aspect of it – such as reading statistics or graphs – and talk to other professionals who are actively engaging with buyers and sellers. We all have different interactions and experiences so I like to speak with multiple people to get different viewpoints. The qualitative side, if you will.
Mary cautioned that the Days on Market jump was seasonal and not to think too much of it. Quite the opposite, in fact. Another market indicator that needs attention is the amount of houses available for sale, aka inventory.
Per Mary, as seen in the graph below, inventory is at a 14-year low in the county (fourteen years is how far back the data goes, so it might even be longer).
With 515 single family homes for sale in the county, where there are over 340,000 total homes, only 0.15% were available for sale in December. The highest level of inventory came in July 2008 (no surprise there) when over 2% of all homes were for sale.
Maybe that doesn’t sound like a big difference, but another way to say it is that there are 13x fewer homes for sale!
We are still experiencing a severe housing shortage in the area. The population has steadily increased due to strong job growth, and sellers are now holding on to their properties for a variety of reasons. This is good for homeowners.
Despite reports of fewer multiple-bid scenarios, the historically-low inventory level could result in a tough home-buying experience for buyers. Luckily, as Mary points out, January is typically a tighter month for inventory and there may be some relief come springtime when more sellers decide to list.