As the inventory crisis in America deepens, the Altos Research data recently has been receiving a lot of attention. I often get asked how Altos data is different from NAR’s - especially with regards to the active inventory measurement. While we both track homes listed for sale, you might see Altos report 350,000 active inventory where NAR reports 1 million. Why the discrepancy? There are a few key differences between these "headline" numbers we report:
1) Pending Sales and What You Can Actually Buy Today
The biggest difference is that NAR includes pending sales in this count, while we specifically remove them. Our measure is of current active inventory - those homes that you can purchase today. In contrast, those that are in contract are no longer available to be purchased. If the contract fails, and the house is relisted, then it will re-enter the active inventory. All Altos Research is designed to be a measure of: if you walk into the market today, these are the homes you’ll see for sale. NAR’s is perhaps more intended to be an analysis of what happened last month.
2) Weekly vs. Monthly Reporting
Altos focuses on real-time analytics. We measure, analyze and report on the whole US real estate market every week. The analysis published by NAR is mostly previous-month-focused. Consider a home which is on the market February 1 and which gets an offer and goes into contract on February 7. It the Altos data set, this home is no longer counted as active inventory in week 2, 3, 4. In NAR's estimate of active inventory in February, it still gets included.
3) Single Family Homes vs. All Homes
When reading the headline numbers also pay attention to the property types being counted. NAR, for the purposes of their media reports, includes all property types in the one big number. At Altos, we find our clients like to have single family homes and condos as separate data sets. The markets may be behaving very differently from one another. When we share national data in our YouTube videos, for example, we typically focus on Single Family Homes. In April 2021, while there are 310,000 single family homes currently on the market, there are another 120,000 condos across the country.