How we classify housing markets

Every city and ZIP code on Properties Incorporated carries a market verdict — buyer's market, seller's market, or balanced. This page documents exactly how we reach that verdict: the signals we read, the thresholds we apply, and the public data behind them. No black box.

Maintained by Marc Henderson, Founder & Data EditorLast reviewed

In short: we score three published market signals — months of supply, sale-to-list price ratio, and days on market — and map the combined score to one of five market conditions. We do not model or predict prices. We aggregate public data and apply a consistent, transparent rule set to it.

The five market classifications

Strong seller's market

Composite score 4 or higher

Inventory is scarce, homes sell over ask, and offers move fast. Buyers should expect competition and limited room to negotiate.

Seller's market

Composite score 2 to 3

Demand outpaces supply. Sellers hold the advantage, though conditions are less extreme than a strong seller's market.

Balanced market

Composite score 0 to 1

Supply and demand sit near equilibrium. Neither side holds a structural edge — pricing and timing matter most.

Leaning buyer's

Composite score −1

Inventory is loosening and homes take longer to sell. Buyers are gaining negotiating room.

Buyer's market

Composite score −2 or lower

Surplus inventory and slower sales give buyers significant leverage — time to inspect, compare, and negotiate terms.

How the composite score is calculated

We start every market at a neutral score of zero, then adjust it up (toward sellers) or down (toward buyers) based on three signals. Months of supply carries the most weight because it most directly measures the balance of supply and demand. The combined score is then mapped to the five classifications above.

Months of supply

Primary

How many months it would take to sell every active listing at the current sales pace. The single strongest indicator of negotiating leverage.

  • •Under 2 months → strongly favors sellers (+3)
  • •2 to under 3 months → favors sellers (+2)
  • •3 to under 4 months → leans seller (+1)
  • •4 to 5 months → neutral (no adjustment)
  • •Over 5 months → leans buyer (−1)
  • •Over 7 months → strongly favors buyers (−2)

Sale-to-list price ratio

Secondary

The final sale price as a share of the original asking price. Above 100% means homes are selling over ask — a hallmark of competitive, seller-favored markets.

  • •Above 103% of list → strong seller pressure (+2)
  • •Above 100% of list → seller pressure (+1)
  • •Below 96% of list → buyer leverage (−1)

Days on market

Tiebreaker

How long a typical home sits before going under contract. Fast turnover confirms demand; slow turnover confirms surplus.

  • •Under 14 days → confirms seller strength (+1)
  • •Over 50 days → confirms buyer strength (−1)

When a signal is unavailable for a given market, we fall back to a neutral baseline (4 months of supply, a 98% sale-to-list ratio, and 30 days on market) so the absence of one data point never skews the verdict.

Where the data comes from

Every signal above is drawn from public, widely trusted sources — Redfin sales data, Zillow research, the U.S. Census Bureau's American Community Survey, and the Federal Reserve's FRED database. We aggregate what these organizations already publish; we do not estimate or model figures of our own.

See the full data-sources breakdown

How often we update

Market data refreshes weekly as new Redfin and Zillow figures publish, and every market verdict recalculates against the updated numbers. Each city and ZIP page shows its own last-updated date so you always know how current the figures are. This methodology page is reviewed whenever the underlying classification logic changes.

What this is — and isn't

Our classifications describe current market conditions using published data. They are not a forecast, an appraisal, or investment, financial, or legal advice. We aggregate public data rather than licensed MLS feeds, so figures may differ from a local agent's most recent numbers.

Use the verdict as a starting point for your own research, and confirm specifics with a licensed real estate professional before making a decision.

Who maintains this

Properties Incorporated's market methodology is maintained by Marc Henderson, founder and data editor. Questions about how a verdict was reached, or a figure that looks off? Get in touch— we show our work and welcome corrections.