| Estimating New Home Supply |
| Written by Jonathan Smoke | |
| 12.07.2007 | |
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Discuss this article on the forums. (0 posts) I’m excited to announce that we have added a major new information enhancement to the Neighborhood Insights application to provide visibility into estimated new home supply. As researchers we have been frustrated by the few and inconsistent methods to measure supply in markets. We also wanted a way to analyze supply down to census tracts or zip codes and by price point. The new enhancement does exactly that.  The supply estimates are based on a model we developed. It takes permits and allocates them -- based on recent new home closings -- to price points and census tracts and zip codes. We calculate both an estimated total supply, or inventory number, and a months’ supply estimate. The supply number is intended to reflect in-process construction and standing inventory.We tested the model’s calculations in areas with which we have deep familiarity and are very pleased with the degree to which the estimates reflect supply conditions. We have therefore rolled it out to every market covered in Neighborhood Insights. Premium subscribers now have access to three new reports under “Tracking New Home Supply.” All subscribers should also note that monthly reports and Neighborhood Insights data have been updated within the last week. We know it’s not perfect information, but the supply estimates are a great proxy for measuring relative trends and activity. It’s much closer to intelligence than guessing. In future posts I will share some supply observations. 
We're always looking for feedback from our readers.
No. 1 : housing market Looking back over the past two years I remember my Nephew telling me about the upcoming real estate bubble. I sell five acre parcels in an active Florida county. He was right. However, more accurately, I feel it was a price bubble. I have sold four of the parcels from my developement by reducing the price to the prices from two years ago. |
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