County Real Estate Markets - Hot, Cold, Neutral

When most people decide to sell or buy a home in the County, very few stop to look at the marketplace to see if the market is conducive to their home selling goals. This is probably because most people tend to think of their home as a place to live and not as an asset, an investment.

Neutral Real Estate Markets

These neutral markets are balanced. Generally, interest rates for are low and affordable and the number of buyers and sellers in the marketplace are about equal. The scales don't move quickly in either direction, meaning the market is normal without experiencing volatile swings.

Signs of a Neutral Market

• Three to six months of inventory is on the market.
• Inventory is normal as compared to previous normal months.
• Comparable sale prices are close to active listing prices.
• Sales numbers are stabilized.
• Median sales prices are even.
• For Sale signs are replaced with pending or sold signs within 30 to 45 days.

Real Estate Markets - Buyers

If you are a looking to a purchase   or in a buyer's market this is the best financial market in which to buy. This is because there are more homes available for sale than buyers to purchase all of the homes. Buyers have many more homes to choose from, which increases the odds a buyer will find their perfect home.  In slow real estate markets, serious sellers are often ready and willing to negotiate. This means you can probably buy a home for less than the list price, and the seller might be willing to pay some or all of your closing costs.

Signs of a Buyer’s Market

• Comparable sale prices are higher than active listing prices.
• Inventory is high as compared to previous months.
• More than six months of inventory is currently on the market.
• Fewer buyers are purchasing, resulting in lower closed sale numbers.
• Median sales prices are declining.
• For Sale signs are staying up longer, resulting in longer “Days on Market”.

How to Determine the Months of Inventory

1. Find the total number of sold or closed transactions for last month.
2. Find the total number of active listings on the market last month.
3. Divide the number of total listings by the number of total sales, which results in the number of months of inventory remaining.

As an example, in a buyer's market, there were 3,563 listings available over a given 30 day period. During that time period, 2,134 sales closed. That leaves 7.5 months of inventory remaining on the market, making that marketplace a buyer's market.

Seller's Real Estate Markets

If you are a home owner who wants or has to sell a house in a seller's real estate market, this is the best financial market in which to sell.  This is because there are more home buyers than available homes.  In a strong real estate market often times serious buyers are often willing to pay more than list price. This means you should be able to sell your home quickly and possibly for more than you ask for it.

Signs of a Seller’s Market

• Comparable sale prices are lower than active listing prices.
• Median sales prices are increasing.
• Inventory is very low as compared to previous months.
• Less than six months of inventory is on the market.
• More buyers are purchasing, resulting in higher closed sale numbers.
• For Sale signs are up for a few days before a pending or sold sign is attached.