Supply and Demand. We tend to think of that term regarding the whole market. Most people right now think we have a shortage of listings. We really don’t. We have a shortage of listings people want to buy. But back to my point, most would say that, over all, the whole market has more demand than supply right now. I never like to generalize things that broadly. Here in Lexington, some neighborhoods have more demand than others, and some have more supply. Here is how it works:
Lets say you have 10 buyers wanting a specific neighborhood. If there are only 8 houses for sale, then they all will sell. If there are only 8 buyers and 10 houses for sale, well, two sellers are losers. Those numbers will vary every year.
Right now, Hartland is pretty hot. It has always been a desirable neighborhood, but right now, there are fewer houses coming on the market than there has been in the past. Conversely, Pinnacle was super hot about a year and a half ago. I had two buyers wanting to be in Veteran’s Park Elementary district. Houses were selling as fast as they were listed. Today, many sellers in that neighborhood have put their houses on the market and there are more for sale than there are buyers. It is still a desirable neighborhood, there are just more sellers than buyers at this moment.
Sometimes these changes are complicated and sometimes they are as simple as how many houses are available. We just went though the schools being redistricted. During that time, people had no idea where the district boundaries would be. I think many wanted to play it safe and picked neighborhoods that they knew would not be affected. Pinnacle was within walking distance to Veteran’s Park Elementary. There was more demand than supply. Now that we all know where the new district boundaries are, there seems to be less demand. And also, I wonder if today’s sellers saw how fast their neighbors were selling last year and decided they wanted a piece of the pie…..and flooded the market. Meanwhile, over in Hartland, there was really no hope of getting a better school district. Nothing has changed except there is less supply at the moment.
Supply and Demand applies to specific neighborhoods, price ranges, types of property, school test scores……really just about any criteria people use when considering locations. It is a very fluid thing and changes as often as the price of a lobster at your favorite restaurant.