CREA’s latest statistics seem to suggest that Eastern Canadian cities are heating up, while Toronto and Vancouver are slipping back into buyer’s markets.
TL;DR: London, Ottawa, Montreal, Hamilton-Burlington and Winnipeg are all competitive seller’s markets as indicated by their SNLR ratios. Western Canadian cities seem to be cooling after a sustained period of heated market conditions.
How do SNLR Ratios Measure Market Competition?
Sales-to-New-Listings-Ratio (SNLR) is a metric used by CREA to determine whether a real estate market is advantageous to sellers or buyers. It compares the number of new properties listed for sale with the number of homes sold within the same timeframe.
A market with an SNLR of 0-39% is classified as a buyer’s market. In this scenario inventory exceeds demand, which typically increases buyers’ bargaining power. Sellers in these markets may find that it takes longer to sell their property, and price growth is likely to stall or even decrease.
A market with an SNLR between 40%-60% is considered a balanced market.
A high SNLR over 60% is indicative of a seller’s market. In this scenario, several buyers compete for limited inventory, which pushes up prices and increases the occurrence of bidding wars. In this type of market, sellers hold more bargaining power than buyers do.
Sales to new listing ratios can offer valuable insight into whether it is the right time to buy or sell a home in a particular area.
SNLR Ratios Across Canada – January 2019
|Region||Jan 2018||Jan 2019|
Montreal has seen the biggest ratio change in SNLR Ratio
In January 2019, Montreal recorded the largest ratio change in its SNLR ratio, followed by Ottawa and Quebec City.
This article, Montreal Is Now The Fastest Growing Seller’s Market In Canada, appeared first on Shupilov News.