Real Estate in Nanaimo - Absorption rates as of September 30, 2018
We are two thirds of the way through 2018 and the Nanaimo real estate market is softening.
Several key factors have impacted the market including the new mortgage requirements and the recently introduced stress test. Money is still cheap even though mortgage rates are creeping up. The combination of these changes is making mortgage requirements more stringent and money a little more difficult to get.
After reviewing the Vancouver Island Real Estate Board stats for the month of September, the numbers indicate that the real estate market is slowing.
To get a true picture of how the local market is doing we need to calculate absorption rates. The definition of absorption rates is the number of weeks it takes to sell the current real estate inventory in Nanaimo at the present rate of sales.
Based on the sales data information I received from VIREB, I have calculated the absorption rates for real estate here in Nanaimo. This information helps me to recognize trends in the marketplace so that I can keep my clients informed. It’s especially useful for home sellers so they can have a realistic idea of how many days its likely to take to sell their house.
Below you will find a comparison between absorption rates this year versus last year.
The absorption rate of single family homes in Nanaimo in September 2018 compared with September 2017
September 2018 – 16.09 weeks to sell the inventory that was currently on hand at the end of September.
September 2017 – 9.21 weeks to sell the inventory that was currently on hand at the end of September
In September 2017 we were still experiencing a seller’s market. However, in September 2018 the absorption rate indicates that we have slipped into a balanced market.
A balanced market is defined as a market that has 4-6 months of listed inventory. Source Real Estate Board of Greater Vancouver,
Balanced markets mean that there are a similar number of buyer’s looking to buy real estate as there are sellers hoping to sell. As a result of the slight slow down it is possible that we will see home prices decrease a little over the next few months.