Values are going up and homes are selling quickly. This market is easily identified when the Average Monthly Supply runs from just a few weeks to less than 5 months. Next, we have a stable market wherein Supply and Demand are in relative equilibrium.
Values are generally flat.
It's neither a buyer's nor a seller's market, and the Average Monthly Supply runs between 5 and 7 months. Last, we have the dreaded declining market wherein supply exceeds demand and where values decline. This is a buyer's market and the Average Monthly Supply exceeds 7 months. The Laws of Supply and Demand define the kind of markets we have and whether values move up or down. We can also have different kinds of markets and markets within markets.