Seattle Bubble

Here’s the latest update on months of supply, or “absorption rates” for the 30 NWMLS areas in King County. For an explanation of what months of supply means, please refer to the original neighborhood MOS breakdown post.

Remember our metric: less than 6 MOS is a sellers market and above 6 is a buyer’s market, meaning that buyers have better negotiating power, not that homes are necessarily priced attractively for buyers. Before this year, the longest that King County as a whole has sustained a MOS above 6 was 4-5 months in the winter of 1994-1995. March MOS for King County came in at 6.19 (slightly higher than February), bringing the current run to seven months.

In the graphs below, you’re looking at the MOS for the “Res Only” data from the NWMLS King County Breakout pdfs for the nine-month period of July 2007 through March 2008. The bar graph is centered vertically on 6.0 MOS, so that it is easier to visually tell the difference between a seller’s and buyer’s market (i.e. - shorter bars mean a more balanced market). Each graph again has the same scale on the vertical axis and has the King County aggregate figure plotted in red, so they can be easily compared.

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I was going to spread out the stats posts a bit, but since people have been asking for months of supply (a.k.a. “absorption rate”) data after yesterday’s inventory post, I’m posting it today. For an explanation of what months of supply means, please refer to the original neighborhood MOS breakdown post.

Keep in mind that we are considering below 6 MOS to be a sellers market and above 6 as a buyer’s market. Based on the sketchy pre-2000 data we have available, the longest that King County as a whole has sustained a MOS above 6 was 4-5 months in the winter of 1994-1995. With February’s 6.14 MOS, the current run is up to six months.

In the graphs below, you’re looking at the MOS for the “Res Only” data from the NWMLS King County Breakout pdfs for July 2007 through February 2008. The bar graph is centered vertically on 6.0 MOS, so that it is easier to visually tell the difference between a seller’s and buyer’s market (i.e. - shorter bars mean a more balanced market). Each graph again has the same scale on the vertical axis and has the King County aggregate figure plotted in red, so they can be easily compared.

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Here’s an update to the King County single-family neighborhood inventory growth charts I first posted last month.

The data that makes up these charts is publicly available from the NWMLS, and can be found in the NWMLS King County Breakout pdfs. Keep in mind that what’s being plotted here is total percent growth since January 2007. If it would be more helpful to present the data in a different way, I’m open to suggestions. Each graph still has the same scale on the vertical axis, for easy comparison. The King County aggregate figure is plotted in red with circles marking the data points.

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Let’s do some more number-crunching and neighborhood analysis. Here’s a detailed look at single-family house “months of supply” (MOS) over the last year, broken down by neighborhood. “Months of supply” is just a way of looking at the relationship between the number of homes on the market and the number of sales taking place.

To calculate months of supply for any area, you simply divide the total number of homes for sale by the number of pending sales. Generally 6 months of supply is considered a “balanced market,” while below 6 is a sellers market and above is a buyer’s market. Historically, the highest MOS for the King County area (post-1993, pre-2007) was 6.7-6.9 in the winter of 1994-1995 (based on the best available data, which is sketchy pre-2000). The current county-wide MOS is 7.54.

For the graphs below, I’ve again taken the “Res Only” data from the NWMLS King County Breakout pdfs for January 2007 through January 2008, this time plotting the monthly value of MOS for each area. I’ve broken the data into the same five graphs as the last neighborhood breakdown post. This time I’ve plotted them on a bar graph, centered vertically on 6.0 MOS, so that it is easier to visually tell the difference between a seller’s and buyer’s market. Each graph again has the same scale on the vertical axis and has the King County aggregate figure plotted in red, so they can be easily compared.

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In a lot of the feedback we’ve been getting lately, two recurring themes are a desire for more number-crunching and more neighborhood analysis. So, let’s have some of both those things. Let’s take a more detailed look at single-family house inventory over the last year, broken down by neighborhood.

What I’ve done below is to take the “Res Only” data from the NWMLS King County Breakout pdfs for January 2007 through January 2008, and plot the total percent growth. I’ve broken the data into five separate graphs (the same groups the NWMLS uses in the breakout pdfs), in order to make it more digestable, but each graph still has the same scale on the vertical axis, so they can be easily compared. Additionally, each graph has the King County aggregate figure plotted in red with circles marking the data points.
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