What the Numbers Actually Mean - A guide to the market metrics worth understanding

Real estate has its own language, and a lot of it gets thrown around in ways that are either vague or hard to understand. These terms show up in headlines, in market reports, and in conversations with agents, and they're more useful than most people realize, once you understand what they're actually measuring.

Here's what the core ones mean, and why they matter.

Months of Inventory

This is probably the single most telling number in any market update, and it's exactly what it sounds like: At the current pace of sales, how many months would it take to sell everything listed right now?

Low inventory, generally under three months, signals a sellers' market. Demand is outpacing supply, competition among buyers is higher, and prices tend to hold or climb. Above four months, you're looking at more balance or a shift toward buyers. Above six months is considered a buyers' market with more options, less urgency, and more room to negotiate.

Benchmark Price

The Benchmark Price is what most Canadian real estate boards use as their primary price measure, and it's worth understanding why it's different from average or median price.

Average sale price adds up all the sales and divides by the number of transactions. That makes it sensitive to outliers - one unusually high sale can pull the number up significantly, which can make a market look stronger than it is. Median is more stable, sitting at the midpoint of all sales, but it still doesn't account for what's actually being sold.

The benchmark price is designed to measure the same type of property over time. It tracks a ‘typical’ home in each category (detached, semi-detached, townhome, apartment) using a model that adjusts for features rather than just raw sale prices. When the benchmark goes up, it means comparable homes are selling for more. It's a cleaner measure of price movement, which is why market reports tend to lead with it.

Days on Market

Days on market (DOM) tracks how long a listing has been active before selling firm. It's a useful proxy for demand. The lower it is, the faster properties are moving, which typically reflects competitive conditions.

A few things worth knowing: DOM resets if a property is relisted after being taken off the market, or if an agent refreshes the listing by paying a small fee. This is common enough that it's worth asking, when you're evaluating a listing, whether the current DOM reflects the full time the home has been available. Cumulative days (CDOM) on market tells you more.

Also, high DOM doesn't always mean a property is undesirable. Pricing, timing, and presentation all play a role. A home that's been sitting for 90 days in a market where comparable properties are selling in 15 is worth examining… but so is a home that was priced ambitiously and then correctly adjusted.

Sales-to-Listings Ratio

This one is expressed as a percentage - the number of sales in a given period divided by the number of active listings. It measures the rate at which inventory is being absorbed (purchased).

Under 40% is generally a buyers' market. Between 40 and 55% is balanced. Above 55% signals sellers' market conditions. When this ratio climbs into the 70s or 80s, competition among buyers intensifies considerably and multiple-offer situations become much more common.

List-to-Sale Price Ratio

This tracks the relationship between asking price and final sale price. A ratio over 100% means homes are consistently selling above list, and is a clear indicator of competitive conditions. Under 100% means buyers have room to negotiate.

Like DOM, this number can be manipulated by strategy. Some sellers deliberately list below market value to create competition. The ratio alone doesn't tell you whether a home sold for what it was worth; only what it sold for relative to what it was listed at. Both numbers matter.

Why Any of This Matters

The reason it's worth understanding these metrics isn't so you can walk into a transaction and recite statistics. It's so you can have an informed conversation about what's actually happening in the market, and whether the advice you're getting is rooted in data or in habit.

Market conditions shape your strategy. What works in a low-inventory, high-competition environment is different from what works when supply is up and buyers have time. Understanding the numbers means understanding the context - and that's where good decisions get made.