Buyer's Market?

KrisBerg05 a.jpgI heard a presentation yesterday in which the speaker was discussing the definition of a Buyer’s versus a Seller’s market.  According to this particular Broker, a Buyer’s market exists when the absorption rate for homes exceeds six months; a Seller’s market exists when the absorption rate is fewer than six months.  The absorption rate is defined as the time it would take the current inventory of homes to sell given the average selling pace of the past (typically six months, averaged).  Makes sense, and I thought it would be a useful exercise to see where we stand in Scripps Ranch and in San Diego County as a whole.

SCRIPPS RANCH

Property Type

# Homes Sold in Past Six Months

Avg. # Homes Sold Per Month

# Homes Currently Listed for Sale

Absorption Rate *

Detached

138

23

134

5.8

Attached

95

16

95

5.9

 *Absorption Rate = # Homes Listed divided by Avg. # Homes Sold Per Month over the past six months.

As of this moment, the data would suggest that our market is a very “normal” one here in Scripps.  The numbers for all of San Diego County, however, tell a little different story:

SAN DIEGO COUNTY

Property Type

# Homes Sold in Past Six Months

Avg. # Homes Sold Per Month

# Homes Currently Listed for Sale

Absorption Rate *

Detached

9851

1641

11981

7.3

Attached

4897

816

7438

9.1

Although I have not thoroughly scrutinized this data, I suspect that the condo picture in San Diego County is being heavily influenced by the downtown market.  In the case of both single- and multi-family homes, however, it would appear that, overall, we have indeed moved toward more of a Buyer’s market.  Whether Scripps is lagging and will follow this county-wide trend or whether we will continue to enjoy a “normal” market remains to be seen.
 

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