A couple of years ago when our market’s sales volume bottomed out, our months of supply value was actually THREE YEARS! Now that our Gatlinburg area real estate market has picked up somewhat, the values have changed. Based upon the 847 residential (home, cabin, condo, and mobile home listings) units that local members of our Great Smoky Mountain Association of Realtors MLS reported as sold for the period November 1, 2010 to May 31, 2011, and our board’s supply of 3274 active residential listings currently on the market, I calculate our overall current residential supply at 1.93 years. Although still very high, this is significantly below the value that we saw previously and will hopefully continue to come down. Keep in mind that a 6 MONTH supply is considered by most analysts to be a balanced market so we still have almost 4 times the normal supply that you would expect in a balanced market.
Two factors have combined to cause the improvement in the years of supply calculation. The number of sales have increased from the abysmally low values from 2008-2009 and the number of homes on the market has also decreased. The combination results in a 1/3 reduction in the current supply of homes available on the market today. This number is very important as it is a measure of the market’s leaning either in favor of buyers or in favor of sellers as it was during the peak boom period years of 2004-2007. Our predominantly second home market has certainly come through a rough patch but things to look to be improving all be it slowly. Kind of like the economy as a whole…