THE MADRONA GROUP REAL ESTATE FAQ VIDEO SERIES
WHEN IS IT A SELLERS MARKET?
In this video Jason Fox gives his answer to the question… “What is a Sellers Market?”
A “Seller’s Market” is when there is less than 3 months of housing inventory.
That is based off of the Law of Supply and Demand.
Generally, low supply and high demand increase price and vice versa.
For supply we use a term called Inventory, or how many houses are for sale.
Demand is impossible to pinpoint but we use some key indicators such as population size and growth, job growth rate, access to capitol, interest rates and how quickly homes sell.
When we talk about inventory it is in terms of how many months of inventory we have to sell.
That is the number of active listings divided by sales and pending sales.
A neutral market once was considered 5-6 months of inventory. Recently the economists have shifted it to 3-4 months of inventory.
WHAT IS A SELLERS MARKET? Real Estate FAQ [VIDEO TRANSCRIPT]
Hi everybody this is Jason Fox with The Madrona Group
and today I’m answering
some frequently asked questions about
real estate. People want to know, what is
a seller’s market? A seller’s market
is determined when there is less than
three months of inventory. Inventory
is measured by the active listings
divided by the sales and pending sales.
Currently in January 2020 we’re at about
one month of inventory so we are in a
seller’s market. That’s kind of based off
of supply and demand if there’s not very
much supply of course the demand is
going to be higher.