When I first saw the real estate inventory map in the Bulletin a week or so ago, the first question that came to mind was, “how many houses sold in each of these areas over the past 12 months?” In other words, “how many months of inventory are there in each area?”
Without this data it is very difficult to judge the relative health of the market. 400 homes for sale or 4,000 – neither have any meaning without knowing the current sales pace.
So I asked a good friend/local realtor to run the numbers for the High Lakes school district. This is the area that I am most interested in as it seems to have been the most bubblicious over the past few years. It also happens to be the place I call home.
Turns out there are 421 homes for sale and only 415 sales over the past 12 months. 6 months of supply is considered a balanced market. More than a full year’s supply, the amount of inventory now on the west side, is very unhealthy.
Just like every free market in the world has done for centuries, the local price boom has morphed into an inventory boom. And it now looks like we are more likely to become the next Ashland than the next Aspen.