Each month, Home Value Forecast uses a number of leading real estate market-based indicators to report on activity in the single-family home markets in the top 200 metropolitan areas (CBSAs) in the U.S., and reports on the Top Ten.
There’s been much news about an overall slowdown in the real estate market, and our Home Value Forecast data supports that inference.
Months of Remaining Inventory (MRI) is an indicator that shows how “hot” a market is at a particular time. MRI equals the amount of households on the market divided by the number that sell per month. If an area has a high MRI (let’s say 10 months), it means that the market is saturated — a buyer’s market. If MRI is low (below 3 months) then it becomes a seller’s market. A “balanced” market will have approximately six months of inventory at any given time.
We looked at the percent of markets with MRI under 3 months, 3 – 5.99 months and 6+ months in the 200+ major U.S. metros we follow – below shows the distribution percentages of markets compared to the same timeframe in 2018:
Last year, 12.6% of markets had MRIs below three months, but that has reduced to 3.1% of the markets today. Today’s 3.1% under three months MRI include the following seven metros:
The good news is that two-thirds of the metros we track have Months or Remaining Inventory between four and eight months, the range normally accepted as a healthy and balanced housing market.
The Top Ten
Our Top Ten ranking system at HVF is purely objective and is based on directional trends. It’s not a listing of what markets are most expensive or most in need of inventory — it ranks market momentum at a specific point in time. The Top Ten metros for the month include:
With Amazon adding to their Alexandria, VA location, the Washington-Arlington-Alexandria CBSA is “hot” according to our Market Condition Rank, the only one for this month. Price appreciation in the region is highly correlated with employment gains and should continue as Amazon’s presence increases.
Interested in learning more about the top metros featured in this month’s market report? Contact Pro Teck for more in-depth information on each CBSA listed in this month’s report.
About Pro Teck’s Monthly Housing Market Report
The Home Value Forecast uses a ranking system that is purely objective and is based on directional trends of nine market indicators. Each indicator is given a score based on whether the trend is positive, negative or neutral for that series. For example, a declining trend in active listings would be positive, as would an increasing trend in average price. A composite score for each CBSA is calculated by summing the directional scores of each of its indicators. From the universe of the top 200 CBSAs, each month we highlight topics and trends in the real estate market.