Why do you say we are in a "seller's market"? The S/OL price ratio has been consistently under 100% based on your 6 month trend and keep trending down, meaning buyers have room for negotiation. Just because the Supply in months is still under 6 months doesn't equate to a seller's market if most of the negotiation power is sitting on the buyer's side...
Traditionally inventory is the indicator of a buyer's or seller's market. When inventory is below 6 months the industry considers this a seller's market. When we are between 6-7 months of inventory it is considered a balance market and when we are above 7 months it is considered a buyer's market. In reality, these are arbitrary numbers that I did not create, but what the industry has used. With that said, you can create your own idea of a buyers and a sellers market yourself. For me, I would say that just because the sales to list price ratio isnt at a median of 100% doesn't mean its a buyers market. You mention negotiating power. Just because buyer's now have some negotiating room to me does not indicate that the power is now on their side. Months of inventory, which is a measurement of the rate at which the amount of homes on the market are being consumed/purchased, is a vaid number to look at because so many other numbers seem to follow pretty reguallarly. For instance, as we see inventory apporach 6 months, we typically see the median days on market reach 60 days. The percent of homes under contract when we hit 6 months of inventory also seems to reach about 20% and the median sales price from previous years seems to remain the same. I am looking at inventory but only because things like time on market, percent of homes under contract, median sales price and the like all seem to be influenced by this number. When I see a rise in sales prices from last year to this year exceeding last years prices even with inflation is factored in, that tells me that sellers still have the advantage. When I see that buyers don't have a lot to pick from because the number of homes on market are so limited, this still shows me that seller's have an advantage. I hope this makes sense. With that said, whether it is a buyer's or a seller's market is really a matter of opinion as to what number or numbers you choose to follow and apply. I have decided to follow industry standard for the most part. However, if I see we have below 6 months but see median home value go down, homes sit on the market for over 60 days, less than 20% under contract and more numbers that indicated homes aren't selling, then I will defintely say it is a buyer's market despite the inventory numbers.
Why do you say we are in a "seller's market"? The S/OL price ratio has been consistently under 100% based on your 6 month trend and keep trending down, meaning buyers have room for negotiation. Just because the Supply in months is still under 6 months doesn't equate to a seller's market if most of the negotiation power is sitting on the buyer's side...
Traditionally inventory is the indicator of a buyer's or seller's market. When inventory is below 6 months the industry considers this a seller's market. When we are between 6-7 months of inventory it is considered a balance market and when we are above 7 months it is considered a buyer's market. In reality, these are arbitrary numbers that I did not create, but what the industry has used. With that said, you can create your own idea of a buyers and a sellers market yourself. For me, I would say that just because the sales to list price ratio isnt at a median of 100% doesn't mean its a buyers market. You mention negotiating power. Just because buyer's now have some negotiating room to me does not indicate that the power is now on their side. Months of inventory, which is a measurement of the rate at which the amount of homes on the market are being consumed/purchased, is a vaid number to look at because so many other numbers seem to follow pretty reguallarly. For instance, as we see inventory apporach 6 months, we typically see the median days on market reach 60 days. The percent of homes under contract when we hit 6 months of inventory also seems to reach about 20% and the median sales price from previous years seems to remain the same.
I am looking at inventory but only because things like time on market, percent of homes under contract, median sales price and the like all seem to be influenced by this number. When I see a rise in sales prices from last year to this year exceeding last years prices even with inflation is factored in, that tells me that sellers still have the advantage. When I see that buyers don't have a lot to pick from because the number of homes on market are so limited, this still shows me that seller's have an advantage.
I hope this makes sense. With that said, whether it is a buyer's or a seller's market is really a matter of opinion as to what number or numbers you choose to follow and apply. I have decided to follow industry standard for the most part. However, if I see we have below 6 months but see median home value go down, homes sit on the market for over 60 days, less than 20% under contract and more numbers that indicated homes aren't selling, then I will defintely say it is a buyer's market despite the inventory numbers.