Housing Inventory Sitting On Market Too Long
As I was preparing my reports that we published each month showing the changes to supply and demand in the Tallahassee real estate market, I came across a graph that I have not published in quite some time.
It caught my eye because it demonstrates the level of competition that people with homes on the market are facing each day. It shows the percentage of homes listed for sale that sell each month, and the picture is not altogether pretty for home sellers.
There is a shift in supply and demand occurring in the Tallahassee real estate market, and sellers must understand how it impacts their ability to sell their homes.
Housing Inventory Moving Too Slow
We consider six months of supply of homes to be normal, it is the level at which the market is in equilibrium where home buyers and home sellers are negotiating without a market advantage.
When inventory levels drop below six months of supply, we refer to it as a sellers' market, as there become more buyers than sellers. Values rise in a sellers' market.
The opposite is true when relative supply rises above six months of inventory. When this happens, there are more sellers than buyers and values fall.
So if six months of supply is normal, than we should expect 1/6th of the inventory to sell every months, with adjustments for real estate seasonality cycles.
The following real estate graph was created to show how much of the current inventory sells each month.
The blue vertical bars show the total number of listings for sale in the Tallahassee each month (measured on the left vertical axis), while the red line shows the percentage that sold (measured on the right vertical axis).
Only twice in the six years have we even seen a "normal" month, and it is likely that the streak goes back a few more years. This graph clearly shows how buyers have controlled the market since the burst of the housing bubble, but it also demonstrates that we trend has been generally improving since 2010.
Want to know more about supply and demand in Tallahassee and how it can impact the sale of your home? Simply drop me a note and we'll schedule a time to help you put out market knowledge to work as part of the process of selling your home fast.