As real estate agents, we look at a number of metrics when evaluating the performance of a market. One of the key factors is ‘inventory accumulation.’ This is simply the number of units on the market divided by the average number of sales per month. In other words, this number represents the number of months it will take to sell all of the homes on the market assuming that no other homes are listed.
Right now, Philadelphia has an inventory accumulation of 9. What is interesting about this is if you look at the breakdown by price range:
From $200,000 to $300,000 the accumulation is 9.
From $300,000 to $400,000 the accumulation is 10.
From $400,000 to $500,000 the accumulation is 11.
Notice a pattern? Now here is where it gets interesting:
From $500,000 to $600,000 the accumulation is 18!
I wish I could say that it improves after that, but it keeps climing to an inventory accumulation of 56 when you get to $2,000,000.
So what does this mean? Simply put, the city-wide numbers that are being reported are heavily skewed because of the luxury properties that just are not selling. However, for the “average” Philadelphia buyer and seller under $500,000, the market is strong and moving along. For a more detailed look at the market on a nieghborhood level, see our exclusive market report.
Post on Philly Living's Philadelphia Real Estate blog.
