Are we ccurrently in a buyers’ market or a sellers’ market? The answer to this question could change tomorrow with any unexpected event, but most reasonably-informed adults could look around at the low inventories and continual above-average appreciation in most markets and understand, at least, that we are not currently in a market that favors buyers. What, beyond vibes though, makes this a ‘sellers’ market’?

B2B Member Travis Otto of Cornerstone Real Estate used his presentation time today to fill us in on how these conditions are defined, and gave some other interesting Real Estate statistics.

First, to the question of buyers’ vs sellers’ markets—that will always be a subjective state that can vary by day or neighborhood—but the general rule is that this is dictated by the Absorption Rate, which accounts for, at the current rate of house sales, how long would the current snapshot of available houses take to sell out? Generally speaking, if there is more than 6 months of inventory on the market, then buyers are in a stronger place to negotiate because their supply of choices is high, and the cost for sellers of holding onto an unused house for any length of time can be quite high also. Conversely, with less than 6 months of inventory available, sellers are seen as having this upper hand. Again, this is only a general rule, and there is even talk of sliding it toward 4 months because buyers’ markets as defined now have been so rare in recent years.

According to Travis’s most recent data, we currently have only 9 weeks (2.2 months) of houses on the market. While low, this is a substantial increase over this time last year when that was 6 weeks.

Similar to inventory, we were also introduced to Sell to List Price Ratio which stays quite close to +/-100% but can show acute bumps or drops in demand and also lead changes in pricing, and Average Days on Market, a self-explanatory stat related to Absorption Rate but more acutely describing a velocity of inventory, rather than volume, in the market.

So when is a good time to buy? The above figures can be used to help with timing decisions, but Travis and most professionals would tell you that a good time to buy a home you intend to be in for multiple years is nearly any time that you feel personally ready. Home ownership and investment continues to be the surest way to build wealth in America, and in this pursuit, he is happy to help. Connect with Travis now to start your home buying journey today.

To connect with local businesses and hear or potentially deliver more great presentations like Travis’s, visit one of our meetings any time, and consider joining to become a member!