The ratio of active listings to pendings has been a decent gauge of the market’s relative health.
Here’s our scorecard, historically, of the ACT/PEND ratio:
0-2 Hot market
3-4 Regular market
5-6 Market in trouble
7-8 Too many choices
Here are the active and pendings listings:
|Town or Area||ACT Reg||ACT SS||ACT Reo||ACT Total||CONT/PEND||A/(C+P)|
The market is smoking hot when actives-to-pendings ratios are under 2:1 in a number of areas. The restricted inventory is the cause, and now a primary market indicator. But if inventories start to increase, some pent-up demand may gobble them up – where does it start to balance (or tip over)?