sales down & listings up


One of the metrics that tell us whether we are in a buyer's, seller's, or balanced market is the Sales-to-Active Listings Ratio also known as Absorption Rate.  It tells us the rate at which properties are selling.  Expressed as a percentage, it's calculated by taking the total number of sales at the end of a given time period (usually the past 30 days) and dividing it by the total number of active listings at the end of the same period. 

Using May's numbers for North Vancouver detached homes as an example:
90 sales / 460 active listings = .20 or 20%

A Sales Ratio of .20 or 20% means 2 out of 10 homes selling in a month.

According to the Real Estate Board of Greater Vancouver, 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%
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%.

Since the beginning of the year North Vancouver house market has pretty much sustained balanced market conditions but time will tell where it will continue to sustain!

To compare just where other North Shore property type market conditions trending click on the titles below:
WV apartments                                                           NV apartments
WV townhomes                                                           NV townhomes

Every homeowner wants to make sure they maximize their financial reward when selling their home. 

If you might be considering a move in 2018 we look forward to hearing from you:

June Conway
june@johnjennings.com
604-828-7888
ROYAL LEPAGE SUSSEX-JOHN JENNINGS
www.JohnJennings.com