Understanding Real Estate Stats

Which Real Estate Market Stats Actually Matter - And What They Mean

by John Merrill & Larry Osmond

May 9, 2026

If you’ve ever looked at a real estate market report, you’ve probably seen a flood of numbers: average sale price, median price, days on market, months of inventory, and many more.

The challenge is that many people see the stats without fully understanding what they’re actually telling us – or how one number can paint a completely different picture from another.

Here’s a breakdown of the key market statistics buyers and sellers should pay attention to, and what those numbers really mean.

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Average Sale Price vs. Median Sale Price

These are two of the most commonly quoted statistics – and, perhaps surprisingly, also two of the most misunderstood.

Average Sale Price
The average sale price is calculated by adding together all sale prices and dividing by the number of homes sold.

For example:

• 4 homes sell for $750,000
• 1 luxury home sells for $2,500,000
• The average sale price becomes: $1,100,000

So even though most homes sold $750,000, the average jumps to $1,100,000 because of one much more expensive sale.

Median Sale Price
The median sale price is the middle number when all sales are arranged from lowest to highest.

Using the same example:

• $750,000
• $750,000
• $750,000
• $750,000
• $2,500,000

The median price is simply: $750,000

More often than not, the median sale price provides a more realistic picture of what a “typical” home is selling for.

Why the Difference Matters

In markets with a lot of luxury sales – or very few overall sales – the average price can easily become skewed.

That’s why many analysts and economists prefer median price when measuring broader market trends. However, this isn’t to suggest that one should be ignored in favour of the other – looking at both together often gives a clearer picture – especially in case-by-case analyses such as comparative market assessments of specific properties.

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Days on Market (DOM)

This measures how long it takes for homes to sell.

Low Days on Market

• Indicates strong demand
• Buyers are acting quickly
• Sellers typically have more leverage

High Days on Market

• Indicates slower demand
• Buyers may have more negotiating power
• Pricing becomes increasingly important

However, context matters.

A properly priced home in a slower market may still sell quickly, while overpriced homes can inflate the average DOM statistic.

Further, it is not uncommon for listings of properties that have been sitting on market for a while to be canceled and relisted, which can skew the perception of how many days the property has actually been on market. Some real estate boards will still capture the days on market of previous listings and show a Cumulative Days on Market (CDOM) tally. This is ideal because it provides a more accurate representation of days on market. But, how different real estate boards calculate this varies. For example, some require a minimum number of days off market before the previous days on market are no longer counted, but there isn’t consistency from one real estate board to another. Your Realtor will be able to share the full listing history of any listing you may be interested in.

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Months of Inventory (MOI)

This is one of the most important indicators of whether the market favours buyers or sellers, yet it’s also one of the most overlooked stats by buyers and sellers. It measures how long it would take to sell all current listings if no new homes came onto the market.

The formula is: Total Number of Active Listings / Number of Sales in Previous Month

General Guidelines

For example:

• 640 active listings
• 200 sales last month

Results in: 640 / 200 = 3.2 Months of Inventory

That would suggest a relatively balanced market.

The reason MOI is so noteworthy is because home prices are often a lagging indicator and can change slowly over a period of several months. Further, you often want to see several months or more of price data to get a sense for pricing trends. This is good information, but it doesn’t give you a real-time look at how the market may be changing.

MOI, on the other hand, shifts quickly. When inventory tightens or swells, MOI reacts almost immediately, giving you an early signal of:

• Upcoming price increases (when inventory is low)
• Possible price softening (when inventory rises)

Not only does MOI give you that finger-on-the-pulse sense of what’s happening in the market in real-time, it’s your early-warning system if you want a preview of where the market may be headed.

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Sales-to-New-Listings Ratio (SNLR)

Similar to Months of Inventory, the Sales-to-New-Listings Ratio measures momentum as it happens. It compares how many homes sold versus how many new listings hit the market. In other words, it tells you the pace at which the market is moving.

The formula: (Total Sales in a Period / Total New Listings in a Period) x 100%

What It Means

• Above 60%:  Seller’s market
• 40-60%:  Balanced market
• Below 40%:  Buyer’s market

A market can still have low inventory overall but begin softening if new listings suddenly outpace sales.

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Number of Sales

This statistic often gets overlooked, but it tells us a lot about market confidence. After all, it is possible that prices remain relatively stable for a period even while sales activity drops sharply.

When transaction volume declines:

• buyers may be hesitant,
• sellers may delay listing,
• financing conditions may tighten,
• or uncertainty may increase.

Watching sales volume alongside prices provides a more complete understanding of market health.

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Active Listings

This measures how many homes are currently available for sale.

Rising inventory generally gives buyers:

• more choice,
• more negotiating power,
• and less urgency.

Falling inventory tends to increase competition and upward pressure on prices.

But inventory alone never tells the full story. A city with 1,000 listings may still be extremely competitive if sales activity is high enough.

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Sale-Price-to-List-Price Ratio

This shows how close homes are selling to their asking prices.

Examples:

• 102% ratio → homes selling over asking
• 98% ratio → homes selling below asking

This statistic can help reveal market psychology.

In hot markets, aggressive bidding tends to push this number above 100%, while in slower markets, buyers may gain some negotiating leverage.

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Why One Statistic Alone Can Be Misleading

No single market statistic tells the whole story.

For example:

• Average prices could rise simply because more higher priced homes sold.
• Sales could decline while prices remain stable.
• Inventory could increase but still remain historically low.
• Days on market could rise because sellers are overpricing homes.

That’s why it’s so important to look at multiple data points together rather than focusing on one headline number.

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The Bottom Line

Real estate statistics are valuable tools – but only when properly understood in context.

The most informed buyers and sellers look beyond headlines and focus on the relationships between the numbers:

• prices,
• inventory,
• sales activity,
• and market balance.

Understanding what these statistics actually mean can help you make smarter decisions, negotiate more effectively, and better understand where the market may be heading next.

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