Real estate professionals often speak of being in either a buyer’s market or a seller’s market. You don’t have to be any kind of subject matter expert to get a feel for what they’re talking about. A buyer’s market is when there is more real estate for sale than there are buyers looking to purchase. A seller’s market is the opposite – there are more people trying to buy real estate than there are homes on the market. During a buyer’s market it is a time where conditions are a little more favorable for those who are shopping for a property. A seller’s market, meanwhile, means things look rosier for those trying to get their place sold.
That’s the headline, but of course, there’s a bit more to it than all that. In this post, we’re going to take a closer look at what actually defines a buyer’s market. Then, we’ll list some of the implications, both for buyers and for sellers.
We hope this housing market guide is helpful for anyone who’s looking to purchase a place of their own, but also for those who are wondering about the best way to sell a house.
Defining a Buyer’s Market
Again, the long and short of it is that a buyer’s market refers to any real estate market in which you’d rather be on the homebuyer’s side than the home seller’s side. Buyer’s market can be caused by economic circumstances, such as mortgage rates, or inflation and can change depending on location. If you are looking for a home and are able to choose a location, try finding an area that is experiencing more of a buyer’s market.
To be a little more technical about it, in a buyer’s market, supply exceeds demand. In other words, there are more houses than there are people looking to buy. This means that the buyer has plenty of options to choose from, while the seller will have fewer prospects but more competition.
In a buyer’s market, house hunters will generally have more wiggle room to negotiate and to get a better price, while sellers will have to work a little harder just to get interested parties through the door, much less close on a deal. Homes during this time generally sell for less than homes during a sellers market – making it an optimal time to look for the home you want.
If You’re a Buyer…
With all of that said, what are some practical considerations for buyers in a buyer’s market?
- First and foremost, remember that there are many homes to choose from, and not as many people looking to buy, so you have a little more leeway to shop around and hold out for the house you really want. Don’t get too comfortable, though; it’s still very possible that a really attractive home will get snatched up immediately, especially if the price is right.
- In a buyer’s market, you have a lot more freedom to ask for a lower price. Remember, sellers likely won’t have as much interest in their home, so don’t hesitate to try to negotiate a little.
- Even though there are many options you’ll still want to make sure you have your credit scores as built up as possible and your mortgage plans in place so you can be ready when you find a good deal on the right house.
- Be aware that many sellers will try to distinguish themselves to get the sale by throwing in some extras, like offering you a home renovation allowance. And if you’re not offered these little perks, you can always ask for them.
If You’re a Seller…
For anyone trying to get their house sold in a buyer’s market, we’d offer these quick tips.
- It’s all going to come down to pricing. Remember, buyers are at the advantage, so you’re not in a position to hold out for top dollar. Price your home competitively if you want to get any takers. Prices need to be low enough to attract interest and still be a good deal for you as the seller.
- Curb appeal is going to matter, too. Your house hunters will have a lot of options to choose from, and if your place doesn’t wow them right out of the gate, they’ll have little incentive to seriously consider it.
- If you feel like you need to sweeten the deal a little, remember that you can offer things like home renovation budgets, flexible closing schedules, etc. Flexible closing schedules are important to buyers who will be working with a mortgage plan.
- In a buyer’s market, it will be especially important to seek the right information and to make a truly wise decision about the best way to sell a house. Evaluating offers can be complex, you need all the resources you can get. That’s where a SOLD.com report is invaluable. Make sure you claim yours!
Ready for Selling Your Own Property?
It’s helpful to be aware of what kind of real estate market you’re in. Whether you’re buying or selling, market conditions can have a big impact on your ultimate success. When there are many homes on the market you’ll want to be aware of trends and opportunities.
And again, it’s also important to work with good information. If you’re selling your own property, make sure you have your SOLD.com report. In it, you’ll get an individualized recommendation for how to list your house for sale. We’ll show you the best place to get an agent with all the research behind it so you can make the best decision for your situation. We encourage you to put in a request for your free home seller’s report from SOLD.com today!