Real Estate – What Does Low Inventory Mean?

Filed under: Temecula Real Estate

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One common topic in the real estate industry right now is about home availability: is it a good time to buy if we have a low inventory environment? Homeowners and potential buyers are always asking questions about the real estate market. The goal is to optimize the timing of the transaction to improve the financial results that are available for your family.

Current Real Estate Inventory Trends

To dig into the current numbers, we have about a one-month supply of homes right now. That means if no new homes came on the market, then there would be no homes available to buy in one month from now.

This number is low compared to the number of home listings that we usually have here in Temecula. To give you some context, a normalized market has about a six-month supply of homes.

What Does It Mean?

Since our current inventory is about one-sixth of the normal market, it means that there is more competition for the properties that are available. As a buyer, you need to be ready to move fast when you find a home that matches your goals. At the same time, prices are going up due to basic economics: supply and demand.

Low inventory definitely gives an advantage to sellers right now since there isn’t as much product to sell compared to normal trends.

What is the solution to this problem? That’s a tough question to answer, but I would say that one major thing that we need is to have more new home developments built in the area. Selling an existing home to someone else doesn’t actually create inventory. Population growth needs to be factored in, which means that more homes need to be added to the market to accommodate the demands. If you are building a new home and releasing it into the real estate market, that adds to the inventory that is available.

Just because inventory is low, doesn’t mean that you can’t find the home of your dreams. I’ve got great connections in the industry, and I am always here to help with your real estate needs. Call, text or send me an email to learn about the options that are available: (951) 473-0390 or [email protected]