The Real Estate Market Currently Has A Balance Of Buyer Demand And Seller Supply

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For the first time in eight years, the overall U.S. real estate market is experiencing a rare balance between home buyer demand and home seller supply, according to the latest “Current Market Conditions” quarterly survey.

Only 45% of respondents reported more buyers than sellers, compared to a 61%-39% ratio six months ago. Thirty-one percent reported more sellers than buyers; the remaining 24% said their markets are almost evenly divided. In the South, the Midwest, the Northeast and in California, the buyer-seller ratio closely matches the national figures.

National survey results from real estate agents in 47 states mirrors the latest monthly sales activity reported by the National Association of Realtors (NAR), which estimated the nation’s supply of unsold homes for sale at 5.3 months for both January and February. An inventory of 5.5 to 6.0 months is considered a balanced market between buyers and sellers.

“The last time we experienced a balanced housing market was in January, 1998, when we had a 6.4 month supply of unsold homes,” said Walt Molony, a NAR spokesperson. “The record for the lowest inventory was in January of 2005, when we reported a 3.7 month supply.”

There are exceptions to the latest balanced housing market reports – most notably in many Western States and Alaska, where buyers still outnumber sellers by a substantial margin – but overall results indicate an orderly transition to more normal housing markets. This appears to be the beginning of the ‘soft landing’ many economists are predicting for homes for sales and certainly good news for both consumers and Realtors after five years of market imbalance.

The National survey in the first quarter of 2006 also found:

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