We all have heard the terms "Seller's Market and Buyers Market". But how is that calculated, and what does it really mean?

First let's define "Months of Inventory"

• If there are 0-4 months of inventory, meaning that all current listings can expect to be sold within 4 months, it is considered a seller’s market because houses are selling very quickly. In a seller’s market, sellers have the advantage because demand for property exceeds supply.
• If there are 5-8 months of inventory, it is considered a balanced market. Current listings aren’t selling like hotcakes, but they’re not staying on the market too long either.
• If there are 9 or more months of inventory, it is considered a buyer’s market because houses are selling slowly. In a buyer’s market, buyers have more negotiating power than sellers do because the supply of listings exceeds the current demand for housing.

Now let's look at todays market..

The graph Below shows the Market for all Prescott Single Family Residential Homes. As you can see we are looking at record low numbers for months of Inventory..