When people follow the real estate market, most of the attention tends to go to two numbers: how many homes are for sale and how many homes have sold.  But there is another number I pay close attention to each week: pending sales.  This week is a good example of why.  From August 24–30, Edmonton recorded 266 pending residential sales, compared with 195 the previous week.  That's an increase of approximately 36%.  At the same time, the number of new listings coming onto the market declined from 672 to 585, a decrease of about 13%.  So what does that actually tell us?

What is a pending sale?

A property generally moves into pending status after a seller has accepted an offer, but the transaction has not yet reached the point where it can be counted as a completed sale.  There may still be conditions to satisfy or other steps that need to happen before the transaction is finalized.  That's why I don't count a pending property as a sale. Not every pending transaction will ultimately close.  But pending activity can still provide useful information because it shows us where buyers are actively making offers before those transactions begin appearing in the sold statistics.

Why I watch pending sales each week

Sold statistics tell us what has already happened.  Pending activity can give us a glimpse of what is happening right now.  If pending sales begin increasing consistently, we may eventually see some of that activity reflected in future completed sales.  The opposite can also be useful.  If pending activity begins slowing while inventory continues to build, that may be an early indication that buyers are becoming more selective or that the balance between buyers and sellers is beginning to change.  No single number tells us that on its own.  That's why I prefer to look at pending sales alongside new listings, active inventory, completed sales and days on market.

What stood out in Edmonton this week

The interesting part of this week's numbers isn't simply that pending sales increased 36%.  It's that the increase happened during a week when fewer new properties came onto the market.  That tells me buyer activity is still very much present.  Does it mean Edmonton's market suddenly became dramatically stronger this week?  No.  Just as I discussed last week with median sale prices, seven days of data can move around considerably.  One week is a snapshot, not a trend.  What becomes valuable is watching the same measurements consistently.  If pending activity remains elevated over the next several weeks while new inventory continues to slow, that begins to tell us something more meaningful about the direction of the market.

What does this mean if you're buying or selling?

For sellers, pending activity is one indication of how actively buyers are engaging with the homes currently available. But market conditions can vary significantly by neighbourhood, property type and price range.  For buyers, the overall Edmonton numbers are useful context, but they shouldn't create unnecessary urgency.  There may be considerably more competition for one type of property than another, even within the same city.  That's why broad market statistics are a starting point, not a substitute for looking closely at the particular segment of the market you're buying or selling in.

The number I'll be watching next

Over the next couple of weeks, I'll be watching to see whether this increase in pending activity begins showing up in Edmonton's completed sales.  I'll also be watching new listings.  If fewer properties continue coming onto the market while buyer activity remains steady, that relationship becomes increasingly important.  That's one of the reasons I created Monday Market.  Rather than looking at one statistic in isolation or waiting for monthly reports, I'm tracking the same indicators every week so we can see how the Edmonton market develops over time.  

Thinking about buying or selling in Edmonton or the surrounding area?  Market-wide statistics can tell us what's happening broadly, but your neighbourhood, property type and price range may tell a very different story.  

I'm always happy to take a closer look at the numbers that actually apply to you.

Tina Fournier
RE/MAX Real Estate
Edmonton REALTOR®