I check the local inventory numbers every few months. As I review the numbers I think back to my macro-economics class back in college. Even these many years later, I remember that too much supply causes a drop in prices and a scarcity causes prices to rise. I think everyone would agree that most real estate markets in the US are struggling with an oversupply of listings. Credit is tight and generally buyers are not in the buying mood. The Boulder market is not immune. So far this year our sales are off 13% from last year. Properties are selling, but not as quickly or in quantities that we have seen in the past.
What is different in the local market is that the gross number of listings on the market have fallen in the past year. There are fewer houses to choose from now than there were 12 months ago. Obviously not all of those houses have sold, so the owners must have either stayed put or rented their houses out. This lack of oversupply is helping keep prices stable.
I figure inventory by figuring a monthly sales rate and then dividing that sales rate into the number of active listings. Overall for Boulder County the inventory in months is just about the same as it was a year ago, even with a slower sales rate. The graphs for both single family and attached dwellings are shown below.