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Housing Inventory Is Rising — But Don't Get It Twisted

The market is shifting. Here's what the data actually tells us.

If you've been watching the housing market closely, you've probably noticed a theme over the last couple of years: more inventory. And the latest numbers confirm it — we're now sitting at 4.2 months of supply, the highest level we've seen since 2020.

That's a meaningful move. But before buyers start popping champagne and sellers start panicking, let's put this in the proper context.

Where We've Been

To understand where we are, you have to look at the full picture.

Go back to the mid-1980s, and housing inventory was running above 10 months of supply. That's a true buyer's market — plenty of options, plenty of negotiating power, plenty of time to make decisions.

Then came the 2008 financial crisis. The market collapsed, builders pulled back, and inventory started a long, slow decline that never really reversed. By the early 2020s, we were hitting historic lows — as low as 2.2 months of supply. That's not a housing market. That's a feeding frenzy.

The 6-Month Benchmark

In real estate, 6 months of supply is the widely accepted threshold for a balanced market — one where neither buyers nor sellers hold a significant advantage. Below that line, sellers have the upper hand. Above it, buyers do.

We haven't touched that line in years.

At 4.2 months, we're trending in the right direction. But we're still 1.8 months away from balance — and that gap matters more than most people realize.

What This Means Right Now

For buyers: There's more breathing room than there was 12-18 months ago. More listings, slightly less competition, and in some cases, more willingness from sellers to negotiate. That's a real shift worth acknowledging. But don't confuse "better than the worst market in modern history" with "buyers have leverage." Well-priced homes in desirable areas are still moving fast.

For sellers: The era of throwing any home on the market and watching it sell in a weekend with 12 offers? That's largely behind us in most markets. Pricing strategy matters now more than it has in years. Overpriced listings are sitting. Sellers who price correctly are still winning — but the margin for error has shrunk.

For the market overall: We need sustained, continued inventory growth to reach anything resembling true balance. One good year doesn't erase a decade of undersupply. Until we consistently hit and hold above that 6-month threshold, this is still fundamentally a seller's market.

The Bottom Line

4.2 months of supply is encouraging. It's progress. But it's not a market transformation  it's a market correction that still has a long way to go.

The buyers who win right now are the ones who understand the nuance: more options exist, but urgency hasn't disappeared. The sellers who win are the ones who respect the shift and price accordingly.

The data is telling a clear story. The question is whether buyers and sellers are listening.

Have questions about what this means for your specific situation? Let's talk.