How to Know if It's a Buyer's Market or a Seller's Market

Real Estate headlines can be confusing—one week it’s a hot seller’s market, the next week it’s shifting to buyers. So how do you really know where things stand? The answer is in the numbers.

Check the Data

The most reliable metric is months of inventory:

Active Listings ÷ Pending Sales = Months of Inventory

Under 4 months → Seller’s Market

4–6 months → Balanced Market

Over 6 months → Buyer’s Market

Dig Deeper with Buyer Trends

Numbers like days on market (DOM) also matter. They show how quickly buyers are making decisions—and reveal the true strength of the market.

Example: South Orange County

Right now, South Orange County has about 3 months of inventory, which points to a seller’s market. However, with an average 42 DOM, it’s more of a soft seller’s market. Inventory is low, but buyers are still being selective and taking their time.

Neighborhood Variations

Keep in mind: the market doesn’t move the same way everywhere. One neighborhood might be seeing bidding wars, while another just a few miles away feels slower. That’s why hyper-local data always tells the real story.

Example: Ladera Ranch

Active: 59

Pending: 21

Inventory: 3 Months

DOM: 15

Strong Seller’s Market

Example: Talega

Active: 32

Pending: 5

Inventory: 6 Months

DOM: 55

Soft Balanced Market

Whether you’re buying or selling, understanding the true “temperature” of the market is key to making smart decisions. If you’d like a customized breakdown of your neighborhood and how it fits into today’s market, I’d be happy to walk you through the data.

Ronnie Jenkins, Realtor

408-784-0378 | ronniejenkins@gmail.com