What is Sales to Active Listings Ratio?
The Sales to Active Listings Ratio (SAR) is the percentage of listings sold versus the number of active listings in a day.
In a seller’s market, the sales-to-active listings ratio is greater than 20%.
In a balanced market, the sales-to-active listings ratio is between 12% to 20%.
In a buyer’s market, the sales-to-active listings ratio is lower than 12%.
Sales to Active Ratio in Vancouver
- 20% or higher = Sellers Market
- 12% to 20% = Balanced Market
- 12% or lower = Buyers Market
The Importance of Understanding Sales to Active Ratio
The Sales to Active Ratio, also known as List to Sales Ratio, is an important statistic to keep an eye on in the real estate market. It is one of the only stats that tells you how a market is doing.
Simply looking at how many listings have sold in an area does not tell you much. The sales volume means nothing without comparing the number of listings on the market.
By knowing what the current market is, you make smarter decisions in the real estate market. It better informs you about the likelihood of selling or buying real estate today.
What is a seller’s market in the Vancouver real estate market?
A seller’s market occurs when there is shortage of listings on the market or more potential buyers than homes. This means the market is favourable to people selling their homes.
For a market to be a strong seller’s market in the Vancouver real estate market, the ratio has to be 20% or higher. 20% – so for every 100 listings – if more than 20 sell in 1 day and 100 new listings come out that day – that’s considered a seller’s market.
What is a balanced market in the Vancouver real estate market?
A balanced market occurs when there is more or less the same amount of listings on the market as there are potential buyers.
For a market to be a balanced market in the Vancouver real estate market, the ratio has to be between 12% and 20%. For every 100 listings – if between 12 and 20 listings sell in 1 day and 100 new listings come out that day – that’s considered a balanced market.
What is a buyer’s market in the Vancouver real estate market?
A buyer’s market occurs when there is a surplus of listings on the market or more homes for sale than potential buyers. This means the market is favourable to people buying homes.
For a market to be a strong buyer’s market in the Vancouver real estate market, the ratio has to be lower than 12%. So for every 100 listings – if less than 12 sell in 1 day and 100 new listings come out that day – that’s considered a buyer’s market.
What type of real estate market are we in?
The real estate market you are in depends on the current Sales to Active Listing ratio. By looking at this statistic, you determine if you are in a seller’s, balanced or buyer’s market.
Before looking at any statistics, make sure you know what local real estate area is specific to you. General market statistics do not inform you of your unique situation. Therefore, figuring out what area you are in is the first step to getting informed about your real estate market today.
Next, check online at trusted resources in your area or also ask your local Realtor for this information.
Watch this video for a few helpful guidelines to understanding your real estate market. Top Vancouver Realtor Leo Wilk shares easy tips for you to stay informed about your local market.
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What other factors are important to pay attention to?
Aside from the Sales to Active Listings Ratio, there are many factors influencing the housing market. Factors such as mortgage interest rates, inflation, government assistance programs, employment levels, immigration levels and the local economy all come into play. Thus, these factors and more influence supply and demand of housing.
Only looking at one statistic does not tell the whole story of your real estate market. Always speak to a professional local Realtor to get an up to date understanding of your local area.
Vancouver Real Estate Market Statistics and Latest Information
Also, be sure to check out our market update page for the latest statistics and information about the Vancouver real estate market. Our team is always keeping up with the most important statistics and market information.
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For more information on real estate market in Vancouver, current trends, buying a home or selling a home, contact Leo Wilk – Your Top Vancouver Realtor.
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