If there’s one question CMK agents get asked time, and time again, it’s “How’s the market?” Our current answer? “It’s great!” But let’s dig a little deeper and give you the full rundown of what “great” means for both buyers and sellers. Watch our latest video from CEO and Broker, Christian Klueg, on the 2018 real estate market update.
Supply and demand are the main factors when determining the health of any given market, and real estate is no different. The best way to understand the effects of supply and demand in the local housing market is to look at the Month’s Supply of Inventory (MSI). MSI determines how long it would take to sell every listed house without adding any new listings.
A balanced market is between an MSI of 5 and 6 months. When the MSI is above 6, we are in a buyer’s market because there are more available houses for a longer period of time, giving buyers more purchasing power. When the MSI is below 5, it’s a seller’s market due to a higher demand than supply. At the start of 2018, the average MSI in our local market was 4.2.
What This Means for You
Over the past 18 years, we’ve seen dramatic changes in the market, with 13,000 sales in the year 2006, a drastic drop to 7,700 during the 2008 recession, and by 2017 we had climbed back up to 13,000. Demand is back up to pre-recession levels and there are fewer houses coming onto the market, causing demand to outpace supply, making this a great time be selling a home.
While we’re currently in a slight seller’s market, as a buyer, you’re also in a great position. With interest rates still at historic lows, if you’re looking to purchase, you’ll be buying into a stable and healthy market that is predicted to continue into the future.
Contact one of our awesome Realtors if you’d like to discuss the 2018 real estate market update in greater detail or if you’re thinking about buying or selling!