If there are 10 months of housing supply available....


If there are 10 months of housing supply available....
By Scott Rogers • January 14, 2011
Follow this "months of supply" logic with me.... There were 18 detached home sales in the City of Harrisonburg under $180,000 in the second half of 2010. That's 3 sales per month. There are currently 30 such homes listed for sale. Thus, each month only 3 out of the 30 homes will likely go under contract. Trick Question(s): Does this mean that every house will sell in 10 months or less? And if a house in this price range has been on the market for more than 10 months is it be a terrible, terrible house that nobody wants? Remember....30 houses for sale, 3 houses sell per months, so it probably looks like this.... Do you believe it? It doesn't really work that way. Here's the problem (for sellers) --- each month when three houses sell (go under contract), they will always almost be replaced by another three new listings. Thus, every month the odds are the same (roughly) --- there will again be 30 houses for buyers to choose from, and only 3 houses will be chosen. It then becomes clear that some houses will NOT be chosen, month after month. Again and again, a house will be a part of the 27 instead of a part of the 3. Thus, if 10 months of housing supply exists in a particular market segment, and a house has been on the market for 11 months, it isn't necessarily a terrible house --- it just has not been able to rise to the top 10% during any of the past 11 months. That, then, is an interesting object lesson for sellers. What do you need to do (with marketing, price, etc) to be in the top 10% of the houses for sale? Settling for being in the top 30% might not work so well for youIf the top 10% keeps selling, and new listings keep landing in the top 10% --- your "top 30% house" could sit on the market for month after month. Receive Updates by Email Recent Articles: There Are Plenty Of Types Of Houses That Exist That Just Are Not Available To Purchase Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell Consider The Cost Of Your Planned Renovations When Planning Your Offer
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 21, 2024 (unless otherwise noted).
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