The Difference Between a Buyers and Sellers Market
- 2 min
What you'll learn.
- What is a buyers market?
- What is a sellers market?
- How to determine which one is which.
Whether you’re looking to buy, sell, or just doing your research in preparation for either it’s good to get a general idea on where the ever-changing market stands. You might already have seen from previous experience that there are ebbs and flows in the real estate market depending on the season. Undeniably you’ve seen or heard that it’s one or the other, buyers or sellers who are reaping in the benefits.
What you’ll see in a buyers market
A buyer’s market occurs when the supply exceeds the demand. That means that the available homes for sale exceeds the number of buyers seeking to purchase homes. The inventory to buy a home is high so striking while the iron is hot might even save a buck or two on your new home because real estate prices actually decrease.
Typically, you might find that sellers will lower their prices in hopes to have the upper hand. If you’re a buyer in this market make sure that you see as many properties as you can, take your time. Know what the inventory is like, what the prices are like and make sure you talk with your REALTOR® to gain knowledge on negotiations.
If you find yourself a seller in in a buyers market, get your house in ship shape! You know there’s competition out there, clean up your landscaping, make those $500 quick fixes to show that your house stands out. So, don’t skimp, it’s worth investing in those professional photos for Zillow or Trulia.
What you’ll see in a sellers market
A sellers’ market occurs when the demand exceeds supply. That means that there aren’t nearly as many homes available for buyers, and homes that do come up for sale one week might be sold the next. This kind of demand or housing shortage often brings bidding wars. If a house goes on the market for $250,000, someone else also in their homebuying journey might offer above asking price then it’s an all-out competition between you and the other family trying to get into the home of their dreams.
Here’s a tip for you if you’re looking for a home during a seller’s market, make sure you understand that time is of the essence here. If you find the perfect home quickly make an offer on it before you lose it to someone else. Talk to your REALTOR® about making a solid offer on the home, if your REALTOR® gives you the impression that you need to go above asking price – ensure that you have had that conversation with yourself or your family so that you know what kind of wiggle room you might have.
On the flip side, if you’re a seller in a seller’s market then you’re likely sitting pretty and awaiting that amazing offer to come through. Just know sellers, you still need to make sure your home is in “ship-shape.” The competition is high because there are so few of you, so be prepared with those little quick fixes around the home. Remember, your home will still need to be appraised!
Determining which one’s which
If you’re ready to buy or sell, you should know what kind of market you’re heading into. Talking with a mortgage banker or real estate agent will get you up to speed. Keep in mind the time of year, winter months are often seller’s markets while the spring and summer months tend to be buyers’.
Other indicators you can watch for are market trends in your local area, recent sales in your area, overall real estate inventory and even time on the market. Whomever you are, buyer or seller, we’re ready to help you get into the home of your dreams!