Day 5: How do you know if your property is at the crest of a rising market?
Don’t we all wish that we had a crystal ball? I know I would be a happy camper… or at least have some more answers. However, a really good leading indicator of where we are in the market is where we are in terms of inventory. Right now, in Northern Virginia, and most of the country is in a shorted inventory market. We talk about this in terms of absorption rate: a healthy real estate market has 5-6 months of inventory to sell.
We currently have less than a week of inventory in 22042, 22041, 22046, 22207, 22201 has nearing 42 days on inventory and that is skewed by the amount of Condos that just came on the market as people are moving to suburban properties out of single entry property, which we could spend hours talking about what the future of housing and multi-family will look like.
When there is low inventory, it is economics 101, supply and demand. We look at job and population growth, new large companies moving to areas and how new jobs will be positioned across time.