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So Much for That Housing Shortage

E-MAIL STORY

The accompanying chart should shed some light on why home price declines have picked up the pace in recent months. On display is the number of months' worth of inventory listed for sale.

This metric is very simply calculated by dividing the number of homes for sale by the number of homes sold during a given month. The resulting figure gives us a rough but decent-enough idea of where things stand as far as short-term supply and demand are concerned.

The chart shows that supply has risen substantially compared to demand in recent months. As it stands, the number of months' worth of available inventory is more than double what it was at this time last year.

Conventional wisdom has it that a housing market with over 6 months of inventory is considered a "buyer's market," for what little insight that provides.

-- RICH TOSCANO

A Nerd's Eye View

Rich Toscano is a financial advisor with Pacific Capital Associates*;
he also writes about San Diego real estate at Piggington's Econo-Almanac.
Contact him at rtoscano@pcasd.com.

Recent Nerd's Eye View Posts

The BLS Weighs in (October 30)

Population Positive (October 27)

September Job Data (October 26)

CAR's 2007 Forecast (October 25)

So Much for That Housing Shortage (October 20)

Home Prices Still Declining (October 18)

A Wrench in the EZ-Credit Works (October 6)

Rates On the Decline (October 5)

Declining Home Inventory (October 3)

*Investment advisory services and securities offered through Girard Securities, Inc., member SIPC/FINRA.

This Just In

Bilbray's Cash:

Congressman rakes in campaign contributions from some sources caught up in lobbying investigations.

Tuesday, October 31 -- 5:31 pm

Protecting the Flagship:

Union-Tribune ownership selling several Midwestern newspapers.

Tuesday, October 31 -- 4:00 pm

Chargers Check-In:

Things shaping up 'better than some might have thought' in Chula Vista, official says.

Tuesday, October 31 -- 3:10 pm

Flip This (Haunted) House :

Whoooooo wants to buy a spooky shack?

Monday, October 30 -- 3:29 pm

LETTERS TO THE EDITOR

Hunter Is the Right Choice:

Tuesday, October 31 -- 1:42 pm

CAFÉ SAN DIEGO

Everyone Knows that Condo Conversions Suck :

If I had a dollar for every converter who has told me over the last year that his or her project was good for affordable housing, good for the neighborhood, or good for consumers, I could have retired already.

Tuesday, October 31 -- 3:07 pm

COMMENTARY: SLOP

More Things Hunter :

Some say the congressman might leave his seat in the House no matter what his desires for the White House are. Who would replace him?

Monday, October 30 -- 12:17 pm

COMMENTARY: RICH TOSCANO

The BLS Weighs in :

The last piece (seriously) on San Diego's population changes.

Monday, October 30 -- 11:58 am

Maienschein Backs Goldsmith:

The city councilman backs his former opponent in the city attorney's race.

Wednesday, August 20, 2008 -- 5:30 pm

Hueso: Keep Geisler:

The city councilman says he will re-nominate Rich Geisler to the SEDC board.

Wednesday, August 20, 2008 -- 2:31 pm

Superintendent Pay Questions in North Carolina:

Debate stirs over the details of what the San Diego Unified superintendent earned at his last district.

Wednesday, August 20, 2008 -- 1:36 pm

Walking Away:

Local foreclosure-as-choice company says it's growing.

Wednesday, August 20, 2008 -- 6:14 pm