With the turning of the calendar to 2022, the housing market finds itself continuing in one of the hottest seller’s markets Greater Houston has ever seen.
So what exactly does it mean to be in a seller’s market and how is it measured?
- What is a seller’s market?
- How do we measure a seller’s market?
- What is the current inventory in our local area?
- Summary
In short, a seller’s market means that there are more buyers than sellers in the marketplace leading to more competition among buyers and more offers to choose from for sellers. Because of the competition, sellers have the upper hand in getting the absolute best offer for their property which will both help houses to sell faster and for higher prices.
In economic terms, a seller’s market means there is lower supply and higher demand.
One of the ways we measure whether we are in a seller’s market, buyer’s market, or balanced market is by looking at months supply of inventory (MSI). In real estate, months supply of inventory is the current supply of homes for sale relative to the number of homes being sold.
In other words, it is how many months it would take to sell the current inventory and run out of houses for sale if no other houses were listed for sale.
It is generally agreed that it is a seller’s market when there is 0-4 months of inventory, a balanced market when there is 5-8 months of inventory, and a buyer’s market when there is 9+ months of inventory.
To put these numbers in perspective, the current months of inventory (as of February 1, 2022) in Greater Houston (Brazoria, Fort Bend, Galveston, Harris, Montgomery, and Waller counties) is 1.6. Galveston County is 2.0. League City is 1.0. Dickinson is 1.9. Friendswood is 0.9. Clear Lake is 1.2. Texas City is 3.0. La Marque is 2.1.
That means that if you live in this area, not only is it a seller’s market, but it is a historically hot seller’s market.
In other words, if you’ve thought about selling, now is a great time to do so! Especially if you’re planning to move or have a secondary property that you’d like to cash out on.
If that’s the case, click the link here to request a free market analysis and to schedule a time for us to discuss your options!
For those of you looking to buy a house and wondering how a seller’s market affects you, click here to read my blog post answering the question, “Is now the right time to buy a house?” (HINT: No matter the market, there are always positives to buying!)