The Cincinnati Area Board of Realtors released charts for area sales in September. One of the reasons I like these charts is that they go back four full years, putting the most recent month's data in a long-term context that is easy to miss if you are only comparing to the last year or previous month. Here are some of the key charts I wanted to highlight:
- The first chart shows that we have been in a seller's market that has continued for over five years.
- A balanced market has about 5.5 months of inventory at a time, and we have been under that threshold since before January 2016.
- Ignoring the seasonal variation in this measure, the seller's market has become more extreme with each passing year.
- The second chart displays the active inventory on the last day of each month.
- Though the entire period displayed on the chart is considered a seller's market, you can see that current active inventory is almost 1/3rd of the inventory in 2016, illustrating how extremely low inventory is.
- This chart also shows how massive a change would be necessary for the market to become balanced, not to mention become a buyer's market.
- Inventory would need to triple and demand would need to decline significantly. Neither things are likely to happen quickly, even with a shock as great as the closing of businesses earlier this year.
- The third chart displays how the median sales price has changed over the years. Two things I want to mention here:
- First is notice how much this can change just depending upon the season. If you are a buyer, looking in the off season can help you save some money.
- Secondly, the rate of increase in the peak median sales price for each year has really accelerated from 2019 to 2020, fueled as much by extremely how inventory as by exceptionally low interest rates.
