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This report is a measure of how long it would take, in months, to sell the existing inventory available on the market at the current rate of sale. Real Estate Professionals use Months Supply of Inventory to measure the balance, or health in a specific market. The absolute value of this index provides an indication of whether the market can be considered a "Buyer's Market", a "Balanced Market" or a "Seller's Market". A Months Supply of Inventory index level at, or below THREE (3) months is often referred to as a "Seller's Market" since there is relatively little inventory available to meet demand. In a "Seller's Market" prices are often bid up since there may be competing offers for the same property. Conversely, a Months Supply of Inventory index level at, or above SIX (6) months is often referred to as a "Buyer's Market" since there is plenty of inventory available to meet demand. In a "Buyer's Market" prices may need to be managed downward since there is an abundance of supply for the level of demand. Months Supply of Inventory between THREE (3) and SIX (6) months is often considered a "Balanced Market" with a reasonable level of inventory available to meet demand.

The formula for Months Supply of Inventory is: The number of properties that were on the market on the last day of the month divided by the number of properties where an offer was accepted during the month.