short-term sales slowdown?


North Vancouver January 30 house sales were
  • down 14% from January 2017, 
  • down 57% from December and 
  • down 67% from the 10 year monthly sale average.
End of January the 281 NV homes actively listed for sale was
  • up 6% from January 2017,
  • up 7% from December and
  • down 17% from the 10 year monthly inventory average.
North Vancouver January new listings totals,140 detached homes was
  • up 2% from January 2017,
  • up 198% from December and
  • down 8% from the 10 year month new listing average.
The sales-to-active listings ratio or the absorption rate at which available homes are sold in a specific real estate market during a given time period is calculated by dividing the average number of sales per month by the total number of available homes.

There are three classifications experts use to describe the balance of supply and demand in the housing market:

Seller's market
A seller’s market is when there are more people looking to buy then there are homes available. This causes a rise in price above the long-term average rate of inflation. Typically this is indicated by a sales-to-active listings ratio of 20% or higher.

Buyer's market
In contrast, a buyer’s market is when there are many more homes for sale than there are buyers. As a result, prices increase slower than the long-term average rate of inflation. In extreme circumstances this can cause prices to decline. Typically this is indicated by a sales-to-active listings ratio below 12%.

Balanced market
A balanced market occurs when supply and demand are about the same, with home prices rising in line with long-term average rate of inflation. Typically this is indicated by a sales-to-active listings ratio between 12% and 20%.

Summary
Over a sustained period of time:
  • a seller's market is represented by a ratio of 20% or higher
  • a buyer's market is represented by a ratio of 11% or lower
  • a balanced market rests between 12-19%
In January, North Vancouver house market absorption rate was 11%, that is, 11 sales to every 100 listings.  This was the lowest absorption rate since December 2012!  

Will 2018 follow 2017's trend of Sellers Market conditions the first six months and then balance in the latter months or will it sustain with Buyer's conditions throughout 2018?

What do you think?

Prepared by:
June Conway
june@johnjennings.com