If you only track one housing market metric, make it months of supply. It’s not the flashiest number (that honor goes to median price), and it doesn’t make headlines. But months of supply tells you more about market conditions, negotiating leverage, and pricing strategy than any other single data point. Here’s everything you need to know.
What Months of Supply Means
Months of supply answers a simple question: at the current rate of sales, how long would it take to sell every home currently on the market, assuming no new listings were added?
The calculation is straightforward:
Months of Supply = Active Listings / Monthly Closed Sales
If there are 900 homes on the market and 200 homes sold last month, that’s 4.5 months of supply. If there are 500 homes on the market and 250 sold last month, that’s 2.0 months of supply.
The Benchmark Ranges
Industry convention divides months of supply into three zones:
- 0 to 4 months: Seller’s market. Demand exceeds supply. Homes sell quickly, often with multiple offers. Sellers have pricing power. Buyers face competition and have limited negotiating leverage.
- 4 to 6 months: Balanced market. Supply and demand are roughly equal. Homes sell at or near asking price within a reasonable timeframe. Neither buyers nor sellers have a significant advantage.
- 6+ months: Buyer’s market. Supply exceeds demand. Homes take longer to sell. Buyers have more choices and more negotiating power. Sellers may need to reduce prices or offer concessions.
These ranges aren’t absolute rules. Local market dynamics, seasonal patterns, and price segments can all shift the breakpoints. But they provide a useful framework for understanding where any given market sits on the spectrum.
Current Central Oregon Data
Here are the most recent months-of-supply figures for Central Oregon communities:
- Bend: 3.1 months (seller’s market, but approaching balance)
- Redmond: 3.8 months (seller’s market, moving toward balance)
- Sisters: 2.4 months (firmly seller’s market, very tight supply)
- Sunriver: 5.2 months (balanced market, shifted from seller’s market in 2024)
- La Pine: 4.4 months (balanced market)
- Prineville: 4.1 months (balanced, edging toward buyer territory in upper price bands)
- Madras: 4.8 months (balanced)
- Crooked River Ranch: 5.5 months (balanced, approaching buyer’s market)
The story these numbers tell is clear: Central Oregon’s market is in transition. Two years ago, every community on this list was below 3.0 months of supply. Today, only Sisters remains firmly in that territory. Most communities have moved into or toward the balanced range, and a few are approaching buyer’s market territory.
Historical Context
Understanding where months of supply has been helps you appreciate where it’s going:
Deschutes County SFH months of supply:
- 2019 (pre-pandemic): 4.8 months (balanced)
- 2020 (pandemic surge): 1.2 months (extreme seller’s market)
- 2021: 0.8 months (historic low)
- 2022 (rate shock): 2.5 months (sharp increase but still seller’s market)
- 2023: 2.6 months (seller’s market)
- 2024: 3.0 months (seller’s market)
- 2025: 3.2 months (approaching balance)
- 2026 (current): 3.4 months (approaching balance)
The trend line is moving steadily from extreme seller’s market toward balance. At the current trajectory, Deschutes County could reach the balanced range (4+ months) by late 2026 or early 2027. That would be the first balanced market since 2019.
Why It Matters More Than Price
Median price tells you what homes have sold for. Months of supply tells you what’s likely to happen next. Here’s why the distinction matters:
For buyers: In a 2-month-supply market, you need to be ready to make strong offers quickly, potentially waiving contingencies and offering above asking price. In a 5-month-supply market, you can take your time, include contingencies, and negotiate. Months of supply tells you how to behave as a buyer more directly than price data does.
For sellers: In a 2-month-supply market, you can price at the high end of the range and expect quick offers. In a 5-month-supply market, you need to price competitively from day one, because buyers have alternatives. Months of supply tells you how to price your home more reliably than looking at what your neighbor sold for.
For market direction: When months of supply is declining (getting tighter), prices tend to rise. When months of supply is increasing (loosening), price growth slows or reverses. This relationship is more consistent and predictive than any other metric.
How to Use It in Your Strategy
If You Are Buying
Check months of supply for the specific city, neighborhood, and price range you’re targeting. Central Oregon’s overall number may be 3.4 months, but your target neighborhood might be at 2.0 or at 6.0. The strategy that works at 2.0 months (aggressive, fast, minimal contingencies) is very different from the strategy at 6.0 months (patient, negotiating, full contingencies).
If You Are Selling
Months of supply should directly inform your pricing strategy. In a sub-3-month market, you can price at or slightly above recent comparable sales. At 3-5 months, price at recent comps. Above 5 months, consider pricing 2-3% below the most recent comparable sale to attract attention in a crowded market.
We track months of supply across every Central Oregon community in our market reports, updated regularly. For current inventory data and to see what’s available, check our listings. Our team can help you understand what the numbers mean for your specific neighborhood and price range.