Days of Inventory (DOI) reflect the time period required to sell all the properties on the market given the number of closed transaction in the preceding month provided no new product becomes available. This is an excellent benchmark to show the velocity of transaction in relation to the market inventories. This measurement is a broad one and will vary (in some cases dramatically) by price range, location and type of property.
October numbers improved from September DOI and dropped to 12 months inventory. There are some seasonally market functions which generally show increasing days of inventory as we move into the fall but we are still way beyond the last few years. October of 2006 showed just 8.8 months available so that shows DOI increased by 38% from that point.
This is a particularly opportune time for buyers in the market place and a particularly difficult market for sellers. Only properties that are generally in good condition and competitively priced are seeing much activity. Home sellers in the under $400,000 range are particularly impacted by the homebuilder competition who have sliced their pricing by more than 10% in some cases for inventory/spec homes.
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