Are you seeing headlines about “low inventory” and “more homes for sale” at the same time? It is confusing, especially when you are trying to plan a move in Murrieta. One metric cuts through the noise: months of supply. When you understand it, you can time your sale or purchase with more confidence. In this guide, you will learn what months of supply means, how it is read in Murrieta, and the practical steps you can take in any market. Let’s dive in.
What months of supply means
Months of supply, or MOS, estimates how long the current number of active listings would last at the current sales pace if no new homes came on the market. It is the inverse of the absorption rate. Real estate groups such as the National Association of Realtors use it as a quick way to gauge supply and demand balance.
The simple formula
- MOS = Active listings divided by average closed sales per month.
- Absorption rate = Closed sales per month divided by active listings. MOS is 1 divided by absorption rate, expressed in months.
Common rules of thumb help you interpret it:
- Less than 3 months is a strong seller’s market.
- Around 3 to 6 months is balanced.
- More than 6 months favors buyers.
These are general thresholds. Local factors in Murrieta can shift how each range feels on the ground.
Why MOS shifts
How you calculate MOS matters. Short windows like the past 30 days show momentum but can be noisy. Longer windows like a 3-month average smooth out seasonal swings. You also need to be clear about which listings count. Some analysts include all active MLS listings, while others exclude properties that are under contract. MOS is most useful when you break it out by price range, since different tiers move at different speeds.
Murrieta factors that shape MOS
New construction plays a role here. Builder inventory and model home turnover can boost the active listing count, especially in certain price bands, without meaning resale homes are plentiful. Entry-level homes often move faster than higher-end properties, so MOS can vary by price tier and property type.
Seasonality matters in Inland Southern California. Spring and early summer are typically busier, which tends to pull MOS lower. Late fall and winter often bring slower sales, which can push MOS higher. Mortgage rate changes move MOS too. When rates rise, some buyers pause and MOS can increase. When rates fall, demand can return quickly and MOS can compress.
Regional job centers and commuting patterns influence Murrieta demand as well. Shifts in the Inland Empire, San Diego County, and Orange County can change the sales pace, which shows up in MOS.
What MOS ranges mean in Murrieta
Under 2 to 3 months
- Expect multiple offers on well-priced homes.
- Faster timelines from contract to close and fewer concessions.
- Buyers need strong pre-approvals and decisive strategies.
Around 3 to 6 months
- More predictable market times and steady showings.
- Negotiation room appears, especially at the higher end of this band.
- Both sides can align on price using recent neighborhood comps.
Over 6 months
- Longer market times and more price reductions.
- Seller concessions and creative terms become more common.
- Buyers gain time to shop and compare.
Buyers: actions based on MOS
If MOS is tight
- Get fully pre-approved and set a firm budget.
- Be ready to move quickly on new listings, including builder releases.
- Consider escalation strategies and shorter contingency windows where appropriate.
If MOS is balanced
- Shop methodically and lean on local comps and days on market.
- Use inspection findings to shape fair contingencies.
- Watch the pending ratio to judge momentum before you write.
If MOS favors buyers
- Negotiate for price, closing cost credits, or a rate buy-down.
- Ask for longer contingency periods if you need more time.
- Compare more homes within your price band since selection is wider.
Sellers: actions based on MOS
If MOS is tight
- Price with confidence based on the strongest neighborhood comps.
- Prepare for multiple offers and quick timelines by handling pre-list prep, disclosures, and inspection readiness.
- Focus on showing condition to avoid closing delays.
If MOS is balanced
- Price realistically and use light staging to stand out.
- Consider selective concessions to secure the best buyer.
- Expect moderate but steady showings and offers.
If MOS favors buyers
- Improve marketing with professional photos, staging, and broad exposure.
- Be flexible on terms and consider price adjustments.
- Plan for a longer time to close and keep communication open with prospects.
Read MOS the right way
MOS is helpful, but it is one lens. It is based on closed sales, so it looks backward and can lag sudden demand shifts. It also treats every listing as equal, even though homes differ by condition, location, and pricing.
Avoid common misreads
- Do not assume one city-wide MOS tells the whole story. Price bands and neighborhoods often move differently.
- Do not read a one-month spike or dip as a lasting change. Confirm with a rolling 3-month view.
- Remember that low MOS does not always mean few listings. It can also mean the sales pace is very high.
Pair MOS with key metrics
MOS is strongest when you pair it with a few supporting signals:
- Days on market to show marketing time.
- Pending ratio, which is pending listings divided by active listings, to show current momentum.
- New listings per month and price reductions to gauge seller pressure.
How to get accurate local MOS
For Murrieta, MLS data is the most reliable starting point. CRMLS is the core source for most Riverside County listings. You can also review county and state reports for context, and compare public dashboards with care since each uses a different method.
A practical approach is to use a 3-month rolling average and report MOS by price band. Example bands that often fit Murrieta include under 600,000 dollars, 600,000 to 900,000 dollars, 900,000 to 1.2 million dollars, and over 1.2 million dollars. Adjust as needed for current market mix.
Sample MOS example
Here is a simple illustration to show the math. If there are 300 active single-family listings and the market averages 100 closed sales per month, MOS is 3 months. This is just an example to explain the concept.
Methodology note
When you see MOS reported, look for a clear description like this:
- Source: CRMLS data for Murrieta city limits.
- Listing type: Active MLS listings, excluding pending and under-contract.
- Property type: Single-family and condos reported separately.
- Sales window: Average closed sales over the past 3 months.
- Segmentation: Report by price band and property type, with a note about new-construction share.
Ready to move with clarity
Whether you plan to sell or buy, knowing your price-band MOS in Murrieta helps you set strategy, timing, and expectations. If you want a local read of MOS, days on market, and pending ratios for your neighborhood, our team can help you cut through the noise and act with confidence.
If you are considering a sale, get a data-backed plan, full-service marketing, and a clear pricing strategy tailored to your home. Connect with Meeker Realty Group to get started and Get Your Free Home Valuation.
FAQs
What is months of supply in housing?
- Months of supply estimates how long current active listings would last at the current sales pace if no new homes were listed, which helps show supply and demand balance.
How often should I check MOS in Murrieta?
- Checking monthly works for planning, and using a 3-month rolling average helps reduce noise from short-term swings.
Does MOS predict home prices in Murrieta?
- MOS signals leverage, not guaranteed price moves, since persistently high MOS can create downward pressure over time and persistently low MOS can support price gains.
Should I use city-wide MOS or neighborhood MOS?
- Neighborhood and price-band MOS are more actionable for offers and pricing, while city-wide MOS is best for broad context.
How do mortgage rates affect MOS in Murrieta?
- Rising rates often reduce buyer demand and increase MOS, while falling rates can bring buyers back and lower MOS as sales pace improves.
How does new construction change MOS in Murrieta?
- Builder inventory can increase active listings and lift MOS in certain price bands without reflecting true scarcity among resale homes, so segment by price and property type.
