How do you gauge a markets supply & demand?

[Turok Tarango]

Hey BP community!

New to real estate investing. What are some tools that are available when it comes to gauging the market of a city or an area? When ppl say there is a “high demand but a low supply there... ” I’m curious as to where to find the frameworks for that information.

Do you just keep an eye on prices in that area? Ask an agent to share their MLS? Download a certain app? Look at the size of value of the areas school systems? Thank you in advance :)

[Bob Okenwa]

You can find the months' supply of the market to help determine if the market is a buyers market or sellers market.

You can calculate the months of supply by dividing the total number of homes for sale over the number of homes sold in one month. For example, if you search in a neighborhood and notice that there are 30 homes for sale but only 10 homes actually sold last month, it means that there are 3 months of supply left in the market.

6 months supply is considered a balanced market. More than that is a buyers market. Less than that is a sellers market. Fed data is currently showing the national average is 3 months supply your market may vary.

You can find this data using Zillow, Trulia, Redfin, etc.