Inventory Levels Increased But Remain Low - Bellingham Is Still A Sellers' Market
A property status is Active when it is listed and available for sale. When a Buyer makes an offer to buy a home and the Seller accepts their offer (Mutual Acceptance) the property status is changed to Pending. After Buyer and Seller reach Mutual Acceptance, there are often contingencies to the sale. For example, the Buyer may have an inspection contingency and a financing contingency. If either of those contingencies were to become an issue (Buyer did not like the items discovered during an inspection and Buyer and Seller could not agree upon a remedy, for example), then the Buyer may remove their offer. A home that was Pending would not close - the Seller's Listing Agent would change the listing status from Pending back to Active, to alert Buyers that the home is available again for purchase. I often hear neighbors asking me about the sales price for a home that "Sold". In fact, the home is Pending, so realtors and savvy sellers don't share the terms of the sale, in case the sale falls through.
The calculator for Days on Market (DOM) starts when a property is listed and stops when a Seller receives and accepts an offer (Mutual Acceptance). The calculator is re-activated if the sale falls through and the listing status changes from Pending back to Active. For example, if a home is listed (Active) for 5 days and then pended for 15 days and then the sale falls through, on the day the status is changed from Pending back to Active, the DOM would be 5.
If a home is taken off the market for a short period of time and then re-listed, real estate brokers look at the Cumulative Days on Market (CDOM). In the Northwest Multiple Listing Service (NWMLS), the rule is that if a property listing is canceled and re-listed within 60 days, the Days on Market from the original listing are combined with the current Days on Market, which adds up to Cumulative Days on Market (CDOM). For example, if a home was listed for 90 days and then taken off the market for 30 days and then re-listed for 10 days until it Pended, then the CDOM would be 100 days.
This rate is calculated by comparing the current inventory/number of homes on the market to the rate at which homes are currently selling. If there are 100 homes on the market and 25 homes sold on average each month in the last year, then the absorption rate is 4 months: 25 homes/month x 4 months = 100 homes.
See What is a Sellers' Market? for what the absorption rates tells us about whether buyers' or sellers' are in a better position to negotiate.
If we calculate Months Supply of Inventory based on the last one or two months' sales, we can predict a Sales Rate - the likelihood a home will sell in a given month.
If you add up the 15 most recent home sales in a market and divide that total by 15, you have calculated the average sales price.
If you line up the 15 most recent home sales in price order, the 8th/middle sales price is the median sales price.
Some real estate experts focus on the median sales price, because it eliminates the outlier sales - homes that may have sold for significantly less or more than is typical.
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