by Calculated Danger on 9/23/2024 11:01:00 AM
Immediately, within the Calculated Danger Actual Property E-newsletter: Watch Months-of-Provide!
A quick excerpt:
Each stock and gross sales are nicely beneath pre-pandemic ranges, and I believe we have to regulate months-of-supply to forecast value modifications. Traditionally nominal costs declined when months-of-supply approached 6 months – and that’s unlikely any time quickly – nevertheless, as anticipated, months-of-supply is again to 2019 ranges.
Months-of-supply was at 4.2 months in August in comparison with 4.0 months in August 2019. Although stock has declined considerably in comparison with 2019, gross sales have fallen much more – pushing up months-of-supply.
The next graph exhibits months-of-supply since 2017. Be aware that months-of-supply is greater than the final 3 years (2021 – 2023), and above August 2019. Months-of-supply was at 4.2 in August 2017 and 4.3 in August 2018. In 2020 (black), months-of-supply elevated firstly of the pandemic after which declined sharply.
…
What wouldn’t it take to get months-of-supply above 5 months? If gross sales keep depressed at 2023 and 2024 ranges, how a lot would stock have to extend to place months-of-supply at 5 months by, say, June 2024?
There’s way more within the article.
