In this final installment of my 2018 Wilton Manors real estate review, I will share my impressions on the levels of inventory we are seeing in the market.
In simplest terms, available inventory should be low when sales in the next few months are anticipated to be low, and high when there is anticipation of higher sales. Having a low inventory when headed into a slow selling time, for example, is not an indication of a tight market. (This is different than the “official” calculation method. But that doesn’t make the official method correct.)
The chart here looks at inventory across all three neighborhoods of the Island City. Read the chart like this: Let’s say a perfectly balanced market would have an inventory index of 100. If the index is above 100, that means there are more sellers than buyers, and the opposite if the index is below 100. Of course, real estate is not a “perfect” market like, say, the stock market. There’s always going to be variability here and there. I account for some of that in my calculation, but assume further that some “wobble” around that 100 level is normal.
Certainly in 2012, as the market had begun to recover, inventories were dropping dramatically. By late 2013, inventory reached a low point and then generally started increasing as owners and investors could sell into a rising market. Inventories (relative to anticipated volume) peaked in early 2015 and have been wobbling around the 110 level ever since.
In other words, WilMa inventories have been relatively balanced – perhaps at the upper end of the “balanced” range – for some time. Right now, market conditions favor neither buyers nor sellers. As I mentioned in my two previous columns, however, there are some storm clouds on the horizon. Just like they do in the winters up north, please monitor weather conditions keenly as we enter the new year.
In closing, a personal note. This is my last column of 2018. I am grateful to be able to share with you my research and observations, almost in real time. I hope they are making you a better informed consumer and prospective property buyer or seller. Maybe you’ve even noticed a witticism or pun here and there; facts and figures need not be dreary. My best wishes to you all for a splendid 2019, wherever your path should take you.by