The magic number 6

What is it?  The magic number 6 or course!  It represents the months of housing inventory that we like to see.  Why?  Because historically speaking, 6 months of inventory represents a balanced market; one in which the forces of supply and demand are once again in " predictable equilibrium"(see prior post).  It represents a market where, generally speaking, prices are stable.  The way we derive the number is by dividing the number of homes on the market in a given area by the number of homes that are selling in a given month.  And as a general rule any number above 6 is a depreciating market and any number below six is an appreciating one.  It's also noteworthy that the farther away from 6 we get, the crazier the market conditions are.  Right now, in Miami-Dade County we have about 4.5 months of inventory, and the bidding wars have begun!