Inventory is the number of active listings divided by the number of listings that have sold in the past 30 days. The result is the number of months it would take to consume all the current active listings.
For example, right now, Boise has 2137 active single-family homes on the market. In the past 30 days, 449 have sold. This gives us an inventory of 4.76 months. This is slightly up from last month when the total was 4.34 months.
Meridian on the other hand has a 7.38-month supply (1411/191). So that pretty much tells us that there is ample supply of homes and if you have driven around you can confirm. But there is a whole market segment that we should consider separately.
Lets examine the under $250K set. The numbers change drastically. Meridian has 430 actives and 110 sold listings, giving us 3.9 months. That sounds pretty balanced right? Boise has a 2.6-month supply. That is on fire and by the numbers makes it a seller's market.
When you hear people talk about what the market is doing and people are saying it's good or bad it helps to know the specific segment they are referring to. The homes in the upper ranges are stagnating. For example the homes in Boise in the $251K - $500K range have a 7.94 month supply, and it gets worse from there. It would be a good time to purchase in that upper range. For the under $250K segment of the market, a lot of local buyers were waiting for the pricing to bottom out. Well, if the inventory numbers stay where they are, than rock bottom has probably come and gone. The affordability factory has changed here, but there are still options and there will be for some time.
-Justin
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