B.C. real estate markets are the fastestcoolingin the country right now. Canadian Real Estate Association (CREA) numbers show sales to new listings ratios made a mild decline across the country. Most markets made improvements on a year-over-year basis. However, B.C.’s markets are cooling so fast, it was enough to weight the national market.
Sales To New Listings Ratio (SNLR)
The sales to new listings ratio (SNLR) a common method used to determine how a market is doing. The ratio provides a relative view of how quickly inventory is added and removed from the market. It’s one of the ways those “buyer” or “seller” market labels are created.
The higher the number, the tighter the inventory and prices are more likely to rise. A ratio of 60 percent and above is a seller’s market – where prices are expected to rise. The ratio below 40 percent is a buyer’s market, and prices are expected to fall. Between 40 and 60 percent is considered balanced, and the market is priced right for the moment.
A couple of notes on length and speed to keep in mind. The ratio generally needs to stay in a range long enough for the market to notice. When it’s fast moving, it often acts like the range it’s heading towards, rather than where it’s at. That is, a fast falling ratio often sees prices drop even though it’s “balanced.” Same with a fast rising ratio, even though it may be a “buyer’s” market. These numbers are just one of the indicators you should use to determine what’s happening.
Eastern Canadian Real Estate Markets Are The Fastest Growing
The real estate markets with the fastest rising SNLRs were all in Eastern Canada. Gatineau had the fastest increase with a SNLR of 65.5% in June, an increase of 11.5% from last year. Halifax followed with the SNLR reaching 70.3%, up 8.7% from last year. Ottawa came in third at 74.4%, up 7.3% from last year. Price growth in all three of these markets has lagged the national average.