Inventory: Have we seen the Bottom?
Supply and Demand has been driving our prices up like never before. But are we seeing the bottoming of Supply, or is this merely a flattening before another drop?
For today’s brief blog, I wanted to discuss the levels of inventory, because we’re seeing a flattening over the last few months, which could mean something significant, or it can mean absolutely NOTHING.
On January 1 of this year, we had 5,015 Single Family homes available for sale. This was a 12+ year low, not seeing that few homes available for sale since January of 2008. From there, we dropped even lower and lower, bottoming out in April (end of March) at about 3400 homes available for sale. This is the lowest number of homes we’ve ever seen for sale in over 15 years by a large margin.
Think about it. Our valley is home to 2+ Million people. There are 16,000 Real Estate Agents in the area, and only 3400 homes for sale. No WONDER we had multiple offers, and were seeing thousands and thousands of dollars over asking price on homes. The market simply was stacked in terms of Low Supply and High Demand.
Take a look at this 5 year chart on inventory:
The ride down has been substantial, especially over the last 18 months or so. But you can see our quick decline and more importantly, a small flattening. Let’s enlarge the last 12 months and look and what we’re seeing when we pull the chart in closer.
Taking the end of March with just under 3400 homes for sale, we’ve now seen 3 months (April, May, June) with flat, and ever so slightly increased levels home inventory. We have flat months in the past, even in the past 12 months (July - October) was flat as well, but every month was slightly DECREASING; whereas the last three months have shown a slight INCREASE.
July is not over for another 10 days or so, but as of right now, it looks like we currently have just under 3200 homes for sale. So if this holds, we’ll actually dip back down below even our March levels, creating the LOWEST inventory level in History.
So…
Are we plateauing and seeing relief for home buyers with increased inventory, or are we going to see our current historical low continue to get lower and lower?