Current Absorption Rate

9.11 Months of Inventory

Real Estate Market Inventory

 SELLER's Market            Balanced Market        BUYER's Market

<                          <>                       >

      1       2       3       4       5       6       7       8       9       10     11+

(Months of Inventory) 

The economics of the real estate market follow the simple rules of supply and demand.  A shortage of supply drives prices up and an excess of supply drives prices down, in general.

To understand real estate statistics better, a general rule of thumb used to measure the 'temperature' of the market is the number of months supply that exist in a specific market.  This number is calculated based on historical data and can be a good indicator of market trends. The calculation of number of homes available in a current period divided by the number of homes sold within that same period gives us the number of months of supply. 

A good benchmark of a balanced market is a 6-7 months supply of inventory.  In this situation there are approximately as many buyers looking for homes as there are sellers willing to sell their home.  An indication of less inventory (i.e. less than 6 months of inventory) indicates a strong SELLER’s market and the opposite is true for a BUYER’s market as illustrated in the graphic at the top of this page.

The source of our data comes from the Baton Rouge Area MLS (Multiple Listing Service) and indicates that the Greater Baton Rouge area has now become a BUYER'S market.  This means that there is currently MORE inventory (supply) than  there are buyers (demand).   In the Baton Rouge Area (which includes Ascension, Livingston, East/West Feliciana and East/West Baton Rouge Parishes) as of the end of October 2008, we have just over 9 months of inventory down from September of 2008. 

This can be attributed to recovery from hurricane Gustav and home buyers getting back into the market.  This information tells us that a great opportunity exists for buyers looking for a new home as there is a good supply of inventory to choose from.

Sales and Inventory History

As of October 31, 2008
Category - RESIDENTIAL

Month	Year	Monthly Sales	Avg ListPrice	Avg Sale Price	% Diff Sell/list	Avg DOM	Curr Inventory	Months Inventory
January	2007	616	$189,168	$186,166	98.41%	67.0	4037	6.55
February	2007	671	$200,205	$195,985	97.89%	71.0	4025	6.00
March	2007	800	$195,917	$192,131	98.07%	70.0	4301	5.38
April	2007	893	$199,119	$194,260	97.56%	68.0	4346	4.87
May	2007	984	$195,708	$191,781	97.99%	67.0	4547	4.62
June	2007	1009	$203,751	$200,531	98.42%	63.0	4815	4.77
July	2007	917	$204,302	$199,855	97.82%	67.0	4967	5.42
August	2007	947	$211,292	$206,841	97.89%	69.0	5371	5.67
September	2007	707	$211,602	$206,828	97.74%	71.0	5377	7.61
October	2007	724	$198,362	$193,002	97.30%	79.0	5196	7.18
November	2007	657	$201,739	$196,554	97.43%	83.0	5096	7.76
December	2007	581	$198,153	$193,249	97.53%	86.0	4942	8.51
Total		9506	$200,777	$196,432	97.84%	71.8	4,752	6.20
January	2008	494	$198,386	$193,252	97.41%	99.0	4987	10.10
February	2008	592	$197,514	$192,196	97.31%	97.0	4894	8.27
March	2008	706	$216,011	$211,050	97.70%	96.0	4845	6.86
April	2008	639	$215,628	$210,565	97.65%	86.0	4844	7.58
May	2008	751	$215,614	$201,700	97.52%	80.0	5202	6.92
June	2008	744	$203,917	$198,545	97.30%	81.99	5013	6.73
July	2008	772	$210,915	$204,400	96.90%	91.09	5097	6.60
August	2008	653	$200,799	$195,237	97.23%	86	5231	8.01
September	2008	401	$196,284	$191,714	97.67%	106	4930	12.54
October	2008	525	$202,605	$196,373	96.92%	96	4784	9.11

The data above is a representation of all areas of Greater Baton Rouge and all price ranges.  To find out what's going on in your neighborhood, we would be happy to generate a tailored FREE report specifically for you.  Please fill out the form below and in the comments section indicate which area(s) or neighborhoods you are interested in receiving information about.