What does a 98% price ratio mean for Greater Victoria sellers?
A 98% price ratio means that, on average, sold properties closed relatively close to the asking price used in the calculation.
What it does not necessarily tell you is where those properties started.
A home may have launched at one price, spent time on the market, adjusted its asking price and then sold close to that new number. Its final sale price is still valuable market evidence. But if you are using the 98% figure to help decide how to price your own home, the path to that sale matters too.
That distinction is particularly useful for sellers who see a high price ratio and interpret it as evidence that there is little risk in starting above the market and negotiating from there.
The better question is not simply, “How close are homes selling to asking?”
It is, “What happened between the day those homes were listed and the day they sold?”
The sale price and the price ratio tell you different things
Consider a simplified example.
A home is listed at $2.1 million. After time on the market, the price is adjusted to $1.85 million. It eventually sells for $1.82 million.
The final sale price of $1.82 million matters. If the property is genuinely comparable to yours, that transaction can help inform what buyers are currently willing to pay.
But the pricing history tells us something different.
The property did not find its buyer at $2.1 million. It found its buyer after the asking price moved considerably closer to the eventual sale price.
Looking only at the final asking price and sale price could therefore give you an incomplete picture of how the market responded to the property.
Neither number is wrong. They simply answer different questions.
The sale price helps tell you what the market paid. The pricing history helps tell you how the seller got there.
Why does that matter if the sale price is still the comparable?
If you are valuing a home today, the final sale price of a relevant comparable is generally more important than the fact that it originally listed higher. A $1.82-million sale does not become less useful simply because the property started at $2.1 million.
But if you are deciding how to launch your own property, the history can be useful.
Suppose two similar homes both sell for approximately $1.82 million.
One listed at $1.85 million and sold within a relatively short period.
The other listed at $2.1 million, remained on the market, adjusted its price and eventually sold for the same $1.82 million.
Those transactions may provide similar evidence about value. They do not necessarily provide the same lesson about pricing strategy.
That is where looking beyond the headline price ratio becomes useful.
What the headline number cannot tell you on its own
Whether the asking price changed
A property that sells close to its current asking price after a reduction can contribute to a healthy overall price ratio just as a property that sells close to its original asking price can.
For sellers, looking at original price, subsequent adjustments, final asking price, sale price and time on market provides more context than the ratio alone.
How long it took to reach the sale
Two homes can achieve similar sale prices and similar price ratios after very different experiences on the market.
Days on market does not tell the whole story either, but read alongside pricing history it can help show how buyers responded.
What happened to homes that did not sell
Sold-property statistics naturally tell us about properties that successfully transacted.
They do not, by themselves, tell you about every competing listing that expired, was cancelled or was withdrawn without a sale.
That matters when assessing a pricing strategy because your real competition is not only the homes that eventually sold. It also includes the listings buyers considered and passed over.
Differences between property types and price ranges
A market-wide figure combines many different properties and buyer pools.
A condominium at $700,000 and a detached home above $2 million are unlikely to face identical demand. Even within the same municipality, property type, condition, location and price point can materially change the competitive landscape.
That is why a broad market statistic is useful context, but not a substitute for looking closely at the properties a likely buyer for your home is actually comparing.
The practical lesson for sellers
The point of looking behind the price ratio is not to argue that the statistic is misleading. It isn’t.
It is to understand what question the statistic can actually answer.
If recent comparable homes are selling close to their asking prices, that can indicate that buyers and sellers are reaching agreement relatively close to the prices being presented when those homes transact.
But it does not mean every original asking price was supported by the market.
For an individual seller, I would rather look at the complete competitive picture:
- What did comparable homes originally list for?
- Were their prices adjusted?
- How long were they exposed to the market?
- What did they ultimately sell for?
- What comparable properties failed to sell?
- What else could a buyer choose at the same price today?
Together, those details tell us much more about where to position a property than a market-wide percentage on its own.
Pricing is ultimately about the buyer’s alternatives
This is especially important in a market where buyers have meaningful choice.
A home’s value is not determined by its asking price, and a buyer does not evaluate it in isolation. They compare it with the other properties available to them and with recent sales that help establish expectations.
That means the most useful pricing conversation is rarely, “How much below asking are homes selling?”
It is, “At this price, what else can our buyer purchase?”
That is the competitive set that matters.
If a $2-million buyer can choose among several comparable homes, your property needs to make sense relative to those alternatives. If the strongest recent comparable sales are around $1.8 million, a high market-wide price ratio does not make a $2.1-million launch price more defensible.
Reading the market without overreading one statistic
Greater Victoria’s market statistics are valuable because they help show broader patterns in sales, inventory, pricing and activity.
But broad statistics are most useful when paired with property-specific analysis.
A 98% price ratio can tell you that sold homes are transacting relatively close to the asking prices reflected in that calculation. It cannot tell you whether your home’s initial asking price is appropriate.
For that, you need the comparables, their pricing histories, the listings that did not sell and the competition currently available to your buyer.
FAQ
Does a 98% price ratio mean I should expect to receive 98% of whatever price I list at?
No. The statistic describes transactions that have already occurred. It does not guarantee that buyers will support any particular asking price.
Your likely sale price depends on the market for your specific property, including location, condition, property type, price range and competing inventory.
If a comparable reduced its price before selling, is it still a useful comparable?
Potentially, yes.
The final sale price remains important evidence of what a buyer was willing to pay for that property. The earlier asking price and subsequent adjustments add context about how the market responded along the way.
For valuation, the sale price matters. For pricing strategy, the history can matter too.
Should I start high and reduce the price later if necessary?
It can work, but it is not the default. The first couple of weeks carry the most buyer attention, so pricing close to the market at launch tends to serve sellers well.
A price adjustment is not inherently a failure. Sometimes new information emerges, market conditions change or the initial strategy needs to be recalibrated.
An adjustment later is a normal tool, best used as part of a plan rather than as the plan itself.
What should I look at instead of the price ratio?
Not instead of it, but alongside it.
Look at recent comparable sales, original and adjusted asking prices, days on market, unsuccessful listings and the properties currently competing for the same buyers.
That provides a much fuller picture of the market your home would actually enter.
Use the number for what it tells you
A market-wide price ratio is a useful piece of context, but it is not a pricing formula.
The final sale price tells us what a buyer ultimately paid. The pricing history tells us something about how the market responded before that sale occurred. And the current competition tells us what buyers will be comparing your home against if you list today.
For sellers, those three pieces are far more useful together than any one percentage on its own.
If you are preparing to sell a higher-value home in Greater Victoria, we can help you look beyond the headline statistics and understand how buyers are responding to properties that genuinely compete with yours. Contact us.
North Pacific Homes Group, eXp Realty
Greater Victoria & South Vancouver Island
250-634-2141
Thanks for being here,
Alex Hughes, REALTOR®, Personal Real Estate Corporation — North Pacific Homes Group (eXp Realty) | Victoria, BC Real Estate
Ricki-Lee Jewell, REALTOR® — North Pacific Homes Group (eXp Realty) | Victoria, BC Real Estate
Steven Reilander, REALTOR® — North Pacific Homes Group (eXp Realty) | Victoria, BC Real Estate
