How do you gauge a markets supply & demand?

How do you gauge a markets supply & demand?

Financial Advisor · Huntington Beach, CA · Member since 2020 · 6 posts · 0 votes

Hey BP community!

New to real estate investing. What are some tools that are available when it comes to gauging the market of a city or an area? When ppl say there is a “high demand but a low supply there... ” I’m curious as to where to find the frameworks for that information.

Do you just keep an eye on prices in that area? Ask an agent to share their MLS? Download a certain app? Look at the size of value of the areas school systems? Thank you in advance :)

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Real Estate Agent/Investor · Peoria, AZ · Member since 2016 · 2k+ posts · 2k+ votes
5y

You can find the months' supply of the market to help determine if the market is a buyers market or sellers market.

You can calculate the months of supply by dividing the total number of homes for sale over the number of homes sold in one month. For example, if you search in a neighborhood and notice that there are 30 homes for sale but only 10 homes actually sold last month, it means that there are 3 months of supply left in the market.

6 months supply is considered a balanced market. More than that is a buyers market. Less than that is a sellers market. Fed data is currently showing the national average is 3 months supply your market may vary.

You can find this data using Zillow, Trulia, Redfin, etc.

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  • Real Estate Agent/Investor · Peoria, AZ · Member since 2016 · 2k+ posts · 2k+ votes
    5y

    You can find the months' supply of the market to help determine if the market is a buyers market or sellers market.

    You can calculate the months of supply by dividing the total number of homes for sale over the number of homes sold in one month. For example, if you search in a neighborhood and notice that there are 30 homes for sale but only 10 homes actually sold last month, it means that there are 3 months of supply left in the market.

    6 months supply is considered a balanced market. More than that is a buyers market. Less than that is a sellers market. Fed data is currently showing the national average is 3 months supply your market may vary.

    You can find this data using Zillow, Trulia, Redfin, etc.

  • Investor · San Francisco · Member since 2020 · 39 posts · 28 votes
    5y

    I love podcasts for getting me through my work day.  I've recently started listening to local podcasts in the markets I'm watching because they will talk about new tax laws, new companies coming in and bringing jobs and other relevant trends.  

  • Rental Property Investor · Austin, TX · Member since 2018 · 128 posts · 84 votes
    5y

    Berkadia is an excellent source for market info such as this. 

  • Realtor · San Luis, AZ · Member since 2019 · 47 posts · 27 votes
    5y

    @Bob Okenwa thank you for you input, I was wondering how to calculate the inventory lately, and your explanation was very a easy to follow! 

  • Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
    5y

    Prices going up or down?  How fast?

  • New to Real Estate · Mesa, AZ · Member since 2020 · 11 posts · 9 votes
    5y

    Good info here. Thanks @Bob Okenwa for the information.

    Also, my rock star agent told me about this company that tracks nationwide mortgage delinquency and gives a monthly reports. Maybe this could be of some use to you as well.

    https://www.blackknightinc.com...

  • Real Estate Agent · Upper Marlboro, MD · Member since 2015 · 16 posts · 14 votes
    5y

    @Turok Tarango

    This is an easy task for a local expert agent.  Where ever you are, line yourself up with an investor friendly agent and ask them monthly.  What is the current supply and demand and which direction is it trending?

    I provide this data within 5 minutes of the question, because as a licensed Agent, we have access to last months historical data.  If you have been tracking it, you can easily see the trend line..

    I am not aware of any consumer app that will supply this amount of hyper local data.

    Currently in my area - Prince George's county MD - Absolutely Mind blowing that all this is occurring during a Pandemic.  #TransferOfWealth - Get in the game now!

    Total Sold Dollar Volume392,117,952up39.3%up9.1%
    Closed Sales1,067up21.7%+7.6%
    Median Sold Price$350,000up11.1%-1.4%
    Average Sold Price$369,682up14.3%+1.6%
    Median Days on Market8 daysdown57.9%-11.1%
    Average Days on Market21 daysdown43.2%-12.5%
    Median Price per Sq Foot$195up15.4%+3.2%
    Average Price per Sq Foot$204up12.1%+3%
  • Investor · Minnesota & Kansas · Member since 2020 · 176 posts · 75 votes
    5y

    @Turok Tarango-Zillow, redfin & realtor can provide you with inventory data. I believe it is a current snapshot of what's happening in a particular market. If you were to look more into some tools to use below are some that we use regularly (job growth & supple/demand)-

    https://www.deptofnumbers.com/...

    https://weareapartments.org/da...

  • Financial Advisor · Huntington Beach, CA · Member since 2020 · 6 posts · 0 votes
    5y

    Super insightful! Thank you everyone who took the time to help me :)

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