A Tale of Two Markets: Inventory Mismatch Paints a More Detailed Picture

The inventory of existing homes for sale in today’s market was recently reported to be at a 3.6-month supply according to the National Association of Realtors latest Existing Home Sales Report. Inventory is now 7.1% lower than this time last year, marking the 20^th consecutive month of year-over-year drops.

Historically, inventory must reach a 6-month supply for a normal market where home prices appreciate with inflation. Anything less than a 6-month supply is a sellers’ market, where the demand for houses outpaces supply and prices go up.

As you can see from the chart below, the United States has been in a sellers’ market since August 2012, but last month’s numbers reached a new low.

Recently Trulia revealed that not only is there a shortage of homes on the market in general, but the homes that are available for sale are not meeting the needs of the buyers that are searching.

Homes are generally bucketed into three groups by price range: starter, trade-up, and premium.

Trulia’s market mismatch score measures the search interest of buyers against the category of homes that are available on the market. For example: “if 60% of buyers are searching for starter homes but only 40% of listings are starter homes, [the] market mismatch score for starter homes would be 20.”

The results of their latest analysis are detailed in the chart below.

Nationally, buyers are searching for starter and trade-up homes and are coming up short with the listings available, leading to a highly competitive seller’s market in these categories. Ninety-two of the top 100 metros have a shortage in trade-up inventory.

Premium homebuyers have the best chance of less competition and a surplus of listings in their price range with an 11-point surplus, leading to more of a buyer’s market.

“It leaves Americans who are in the market for a home increasingly chasing too fewer options in lower price ranges, and sellers of premium homes more likely to be left waiting longer for a buyer.”

 Lawrence Yun, NAR’s Chief Economist doesn’t see an end to this coming any time soon: 

“Competition is likely to heat up even more heading into the spring for house hunters looking for homes in the lower- and mid-market price range.”

Bottom Line

Real estate is local. If you are thinking about buying OR selling this spring, let’s get together to discuss the exact market conditions in your area.  Give me a call – J.P. Cook – 602-320-4253.

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20603 N Echo Mesa Drive Sun City West, AZ 85375

$460,000

2 Beds

2 Baths

2,103 SqFt

Status Active

MLS # 6680198

Property Type Single Family Residence

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Popular San Carlos model with 2 large bedrooms, 2 bathrooms, vaulted ceilings and HUGE utility/laundry room-perfect for crafting or if you need extra space & already plumbed. Kitchen has tons of cabinets w pull-out drawers, granite countertops, island, newer appliances and opens up to the large Arizona room. Skylights & solar tubes offer bright, natural light. You will love the rear, large 20' X 24' enclosed, screened patio room that offers space for entertaining or enjoying the beautiful weather. Desirable North/South exposure, situated in a cul-de-sac, corner lot in Echo Mesa area-close to Sun City West amenities and shopping! No HOA fees and low tax area!

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2813 Hidden Creek Circle Happy Jack, AZ 86024

$460,000

2 Beds

2 Baths

1,252 SqFt

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MLS # 6688152

Property Type Single Family Residence

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Escape to the pines in this charming property located in the Starlight Pines Community. This home was built in 2021 and ready for its new owner! As you enter the home you will see a bright and open living room, kitchen, and dining area. The kitchen has beautiful white cabinets with an island and stainless appliances. The home has neutral paint, upgraded lighting and fixtures, laminate flooring and granite countertops throughout. The inside laundry room is oversized and includes a sink with cabinets. As you enter the Primary bedroom suite you will see a separate sliding door to the back patio. The Primary bathroom has dual sinks, a walk-in tub, a linen closet, and also a walk-in closet. Don't forget about the relaxing covered patio overlooking into nature and wildlife at its best.

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8415 N 47th Drive Glendale, AZ 85302

$460,000

5 Beds

2 Baths

2,080 SqFt

Status Active

MLS # 6683949

Property Type Single Family Residence

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Beautify and well-kept 5-bedroom 2-bathroom home with Split Plan, Porcelain tile floors throughout, spacious living room, Dining Area, Family Rooms plus hallways. Huge pebble diving pool recent replastered, Kitchen with plenty of natural light, Double Pantries. Backyard with a covered patio. Split bedroom plan offers privacy. Close to School and I-17 Freeway and NO HOA.

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630 Ringtail Road Wickenburg, AZ 85390

$460,000

4 Beds

2 Baths

1,805 SqFt

Status Active

MLS # 6686092

Property Type Single Family Residence

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Welcome to your dream home nestled in the heart of Wickenburg, where modern elegance meets comfort. This stunning 4-bedroom residence boasts a perfect blend of contemporary design and timeless charm, offering an exceptional living experience. Step inside to a spacious living area that welcomes you with abundant natural light, creating an inviting ambiance for gatherings and relaxation alike. Enjoy the convenience of updated appliances in the sleek, gourmet kitchen, where culinary adventures await. Outside your oversized lot offers endless possibilities for outdoor entertainment, from al fresco dining to tranquil moments basking in the Arizona sun. Marvel at fantastic views of the mountains. Conveniently located in the heart of Wickenburg, this residence offers easy access to a wealth of amenities, including shopping, dining, arenas and entertainment options. Explore the vibrant local community and discover why Wickenburg is beloved for its small-town charm and rich western heritage. Seize the opportunity to make this exceptional property your own and experience the epitome of modern living in Wickenburg.

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