Ottawa is tipping into a Buyers Market
by Dave Williams
While working on my latest real estate term article on absorption rates I came to realize that we’re almost there. Ottawa is on the verge of tipping into a buyers market for the first time in a long while.
While news reports are touting the 4.6% drop in sales the number I have been watching closely this year is the number of homes we have for sale in the Ottawa Market (Supply). Coupled with the number of homes selling (Demand) we get a picture of our market.
The first 5 months of 2013 saw 6043 homes sell, or an average of 1208 per month.
We started June with 7711 properties for sale in the Ottawa market, which is the highest we have seen in over 5 years.
7711/1208 = 6.38 Months of Inventory
It would take 6 months and 9 days to sell all the homes for sale at this rate. This is one of our leading indicators of the market swinging to the favor of the buyer.
The second indicator I watch is the percentage of homes listed for sale compared to the sales for the month. Last month, May 2013, 3706 homes were listed for sale, while 1804 sold. This gives us a selling percentage of 48.68%. This is still in the balanced market territory.
In our tale of two markets we’ve got one foot in the buyers market and one foot in the balanced market, Ottawa’s real estate market is straddling the fence.
Where do you thing this market is going, are we going to correct by the end of the year or dive head long into a buyers market.