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Inventory in Oakville remains at tight levels....

September 29/2013.  I like to look at inventory absorption rates when I'm listing a property or negotiating for a buyer on a property.  

When inventory is tight (sellers market) not alot of inventory is available for sale.  When inventory is "loose" (buyers market) plenty of inventory is available for buyers to choose from.   We guage this by looking at the number of sales over a month versus the number of active listing there are for a particular price range. For example if we have 10 active listings for properties priced between 200-399k and 5 have sold in the past month we say there is 2 months of inventory available. In other words if no new listings come on the market, we likely will deplete or "absorb" all of this inventory within 2 months.  (10/5=2)  Here is my rule thumb in determining tightness or looseness of real estate markets: 

0-3 months inventory - tight and a sellers' market

3-6 months inventory- neutral market; neither buyers nor sellers have control

6 months plus inventory- buyers' market where buyers have lots of inventory to choose from

Here are the latest numbers from Oakville:

200-399k 1.7 months

400-499k 1.8 months

500-749k 1.5 months

750-999k 2.9 months

1-1.499k 3.79 months

1.5-1.999k 10.7 months

2-3mm 8 months

3mm+ 37 months  

So as you can see the Oakville market has a "tight sellers" market under 1mm dollars, neutral from 1mm-1.5mm and "loosens" considerably above that.  Of course this makes some intuitive sense as affordability becomes more of an issue the more expensive the property.  These statistics have been quite consistent over the past 5 years.  So depending on whether you are selling or buying a property and in what particular price range you are considering, your agent will have a some leeway in negotiating your interest.  This is one type of analysis that our team can help you with.  Regards, George


Posted: Saturday, October 26, 2013 8:51 PM by George Dlugosh


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