Beginning in mid-1995 a trend began to develop in real estate on the West Island that has now resulted in the first “Sellers Market” in a decade. It should be noted that according to the Canada Mortgage and Housing Corp. (CMHC), a ratio of 10 listings per buyer represents “an even marketplace, with no particular advantage being given to either the buyer or seller”. This assumption is based on the fact that for every purchaser, there are at least nine properties for sale that do not meet that buyer’s specific needs, taste, budget or location.

Since the beginning of 1989 we have been in a “Buyers Market”. Over that time span, there were rarely less than 20 listings per buyer. Towards the middle of 1996, the ratio of listings began to decline. That decline became far more notable in 1998 with low mortgage rates, employment improving and consumer confidence increasing. In 2002 we are faced with less than 4 listings per buyer; a true sellers market.

Toward the end of 2000 many agents noticed this trend first-hand when new listings coming onto the market were being shown immediately and multiple offers were being made within the week, if not days. Sales were being concluded in some cases before the listing appeared on the Multiple Listing Service!

How does this affect you?

When there are numerous listings from which to select a home (more than 10 per buyer), the purchaser can and often does take time in making sure they are purchasing the best possible property for their needs and at the best possible price. As homes in a buyers market tend to be available for longer periods of time, there is an ability to move more slowly in making the final purchase decision. In a sellers market the luxury of time is removed. Decisions must often be made immediately when the right home is found.

What is the solution?

In a sellers market, the buyer should do as much preliminary planning as possible. They should evaluate their financial capabilities and overall requirements before beginning the hunt. Thus when that right home is found, they will be in a position to move quickly and efficiently towards making the offer. Any delay, however short can easily result in another offer being accepted from a competing buyer.