What housing inventory numbers can tell us

The months of inventory ratio shows most of the country is in a seller’s market, as of September 2016

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The number of months of inventory (MOI) is an important measure for determining the supply and demand equilibrium in the housing market. This ratio represents the number of months (or days) it would take to completely sell the homes that are currently listed for sale, based on the area’s current rate of sales activity.

According to the Canadian Real Estate Association (CREA), there were 4.8 months (144 days) of inventory on a national basis at the end of August 2016. In CREA’s national statistic package release it’s noted that the MOI has been trending lower since early 2015, “reflecting increasingly tighter housing markets.”

How to calculate MOI (months of inventory)

Active listings for a given period / number of sales for a given period = # MOI

Type of market

It’s a seller’s market if there are four months (approximately 120 days) of inventory or less.

It’s a balanced market if there are four to six months (approximately 120 to 180 days) of inventory.

It’s a buyer’s market if there are six months (approximately 180 days) or more of inventory.

What type of market are we in?

Housing in Canada is regional and there can even be differences from province to province, city to city and even neighbourhood to neighbourhood.

At present, most of the major urban centres in Canada are either in a seller’s market or a balanced market, with the exception of the Atlantic provinces. The East Coast housing markets remain in a buyer’s territory.

months of inventory sept 2016

Sources: Toronto Real Estate Board, Saskatoon Regional Association of Realtors, Association of Regina Realtors, Real Estate Board of Greater Vancouver, Nova Scotia Association of Realtors, Canadian Real Estate Association
Province City Days of inventory MOI (months of inventory) Type of market
Nova Scotia** 297.9 9.9 Buyer
Newfoundland** 262.2 8.7 Buyer
Quebec Montreal Island* 46.7 1.6 Seller
Quebec City* 51.2 1.7 Seller
Ontario Hamilton 36.8 1.2 Seller
Oshawa 36.8 1.2 Seller
Pickering 38.5 1.3 Seller
Burlington 38.8 1.3 Seller
Brampton 40.3 1.4 Seller
City of Toronto 44.9 1.5 Seller
Central Toronto 46.1 1.6 Seller
Markham 46.5 1.6 Seller
Manitoba Winnipeg 77 days 2.6 Seller
Saskatchewan Saskatoon 77.1 2.57 Seller
Regina City 144.5 4.8 Balanced
Alberta Edmonton 61.4 2.1 Seller
Calgary 118.4 4 Balanced
British Columbia Metro Vancouver 63.9 2.1 Seller
Victoria 79.2 2.6 Seller
* As of end of Q2, 2016
** As of August 31, 2016

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