Sellers vs Buyers Market: How to Tell the Difference
The real estate market is full of confusing twists and turns. According to the National Association of Realtors, existing home sales fell over five percent as of June 2022 after skyrocketing during 2020-2021.
If you’re wondering when to buy or sell your home, it’s important to know whether you’re in a buyer’s market or a seller’s market.
Read on to learn more about these markets, and how to tell the difference between the two.
Buyer’s Market: What Does it Mean?
In the housing market, there are times when the supply of available homes for sale is greater than the demand. This gives buyers an advantage since they have more homes to choose from, and more leverage when making an offer.
When you’re in a buyer’s market, you will notice that house prices tend to trend downward. Some homes may sit on the market for weeks or even months before they’re actually sold.
This reduces competition between buyers, but it increases it among sellers. If you’re looking for a home at a great price, then shopping during a buyer’s market is the best time.
Signs of a Seller’s Market
A seller’s market typically occurs when the supply of homes is lower, and demand is higher. The housing market during the COVID-19 pandemic is an excellent example.
When you’re selling your home, this is a great time to do it since you’ll be able to get a higher asking price. If you’re selling to an investor, this is prime time to do so.
During a seller’s market, you’ll likely get several bids on your home. For most sellers, it’s a great way to make extra money and cash in on the equity you built.
Buyers vs Sellers Market: What to Look For
You may wonder, when will be a buyer’s market, or when will it be a seller’s market? It’s impossible to time the market, but there are a few things to keep in mind.
First, pay close attention to other homes for sale in your area. If home inventories are increasing but prices aren’t, then it is likely a buyer’s market. If there are only a few homes for sale with a high asking price or multiple offers, then it’s likely a seller’s market.
Another key sign of a seller’s market is if homes are selling extremely quickly. When homes “sit” and the seller starts to lower the price to find an interested buyer, then it’s much more likely a buyer’s market at that time.
Choose Your Market Wisely
When you decide to sell or buy a home largely depends on whether it’s a buyer’s market or a seller’s market. While you can never really time the housing market perfectly, keeping an eye on home sales near you is a good way to find the right time to make your move.
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