The Sales to Listings Ratio
The Sales to Listings Ratio is a statistic that is used in the Real Estate industry to determine if the market is a sellers market, a balanced market of a buyers market. To determine the ratio, the number of sales over a specific period of time is divided by the number of properties on the market at that same time.
A ratio of under 15% is considered a buyers market, indicating there are more properties on the market and fewer buyers. This is what causes prices to reduce, as sellers are competing for a smaller number of buyers.
A Sales to Listings Ratio of 15% is considered a balanced market. In a balanced market you can expect stable prices, and homes to be selling in a reasonable amount of time.
A Sales to Listings Ratio above 15% indicated a sellers market, where prices can rise as the demand for houses is higher than normal and sellers can demand more for their property.
The Sales to Listings Ratio for the past four weeks for detached homes on the Sunshine Coast was 8.3%. The ratio has been consistently under 10% for the past couple of years. That is why it is not unusual to see properties on the market for extended periods of time.
It also illustrates just how important it is to price your home properly when it is first listed.