Housing Inventory Shrinks in Many Markets

The glut of homes listed for sale continues to shrink gradually in many metropolitan areas.

In November, the supply of homes available for sale in 29 major metropolitan areas was down 3.6% from a month earlier, according to figures compiled by ZipRealty Inc., a real-estate brokerage firm based in Emeryville, Calif. The ZipRealty data cover all single-family homes, condominiums and town houses listed on local multiple-listing services in the 29 metro areas where the firm operates.

On a national basis, home inventories typically decline modestly in November from October. Over the past 25 years, the average decrease in November has been 1.9%, according to Zelman & Associates, a research firm.

The November inventory in ZipRealty's 29 metro areas was down about 10% from a year earlier.

Nationwide, about 4.2 million previously occupied homes were listed for sale at the end of October, according to the National Association of Realtors. That is enough to last about 10 months at the current sales rate, the trade group says. The housing market is considered roughly in balance between supply and demand when the inventory is around six months.

These inventory data don't capture the entire supply. Newly constructed housing and foreclosed homes, a big part of the supply, aren't always included in Realtors' multiple-listing services. In addition, many people have taken their homes off the market in the hope they can get a better price later. Those homes will come back on the market eventually.

"Sellers appear to have finally gotten the message that if you don't have to sell, don't put your house on the market right now," says Patrick Lashinsky, Zip's chief executive officer.

The Zip data don't cover New York City. But Miller Samuel Inc., an appraisal firm there, says there were 9,348 cooperative apartments and condominiums on the market in Manhattan at the end of November, up 4.7% from October and up 38% from November 2007.