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What Does It Mean When We Talk About a “Buyer’s” or “Seller’s” Market?

What Does It Mean When We Talk About a “Buyer’s” or “Seller’s” Market?
The property market is always in a state of change. Sometimes the market is more favorable to buyers and sometimes it’s more favorable to sellers, and every so often it is in a state of “balance.” It is also important to consider the market conditions in the specific price range you are looking to buy or sell in, often they can vary greatly. Market conditions don’t have to dictate your next move, as your trusted agents we can guide you in the sale or purchase of your next home, no matter what type of market you’re facing.
 

What Is A Seller’s Market?

 
A seller’s market is simply a property market that benefits you as a seller. In a seller’s market, there’s a scarcity of properties, which can drive up the price of homes, especially in desirable locations.
 
Sellers can depend on our real estate expertise to know what the market is doing at any given time, but signs of a seller’s market are:
 
  • Low inventory when compared to previous months and/or years.
  • Homes are selling faster.
  • Less than six months of inventory on the market.
  • Median sales prices are growing.
  • Less information in real estate ads; just the bare details.
  • “For Sale” signs don’t stay up long before being replaced with “pending” or “sold”.

What Is A Buyer’s Market?

 
A buyer’s market is the opposite of a seller’s market. If you’re buying at this time you’ll be spoiled for choice as the supply of homes on the market exceeds the number of buyers, giving you the chance to score a fantastic deal. A sharp agent will quickly be able to tell you where the market lies, but here are some signs of a buyer’s market:
 
  • Inventory that is high when compared to previous months and/or years.
  • Homes are selling more slowly.
  • More than six months in inventory on the market.
  • Sales prices are shrinking.
  • Real estate ads are growing in size, giving more details and/or images.
  • “For Sale” signs are staying longer, meaning the days on the market are longer too.
You can find the current month's supply of inventory in the Twin Cities by price range here.
 

Do All Markets Follow The Same Cycles?

 
Markets are always in a state of flux. At its core, people are the driving force behind the real estate market. For example, as more people move into a location, the more need there is for housing. If the number of properties in the area cannot support the number of people moving in, prices of existing homes will likely rise until more homes can be built.
 
This constant change in the supply and demand in a market is how markets shift back and forth from being more favorable for either buyers or sellers.
 

Can I Buy In A Seller’s Market?

 
Absolutely, but it’s not going to be a walk in the park. You’ll need determination, knowledge, and most importantly, someone on your side who knows the market inside and out.
 
Something to consider – you don’t know the seller’s true reasons for wanting to sell. Maybe there’s a divorce pending or another baby on the way and they need more space fast. Whatever is going on with the seller, a savvy agent will spot opportunities to help you and the seller arrive at a mutually agreeable solution.
 
One key reason it’s vital to engage an agent in a seller’s market is for their negotiating skills. While it’s important to always negotiate, a seller’s market calls for serious help to ensure that you don’t pay more than you need to.
 

Should I Wait To Sell?

 

It depends. Is it mandatory that you sell right now or could you wait until market conditions are more favorable to sellers?
 
Consult with us to get our opinion about your chances of getting what you need or want for the sale of your home. We just might have some options you may not have considered that will help you get out from under your home and get on with your life.
 
Don’t be afraid to sell or buy if you think the market isn’t in your favor. The real estate market can be highly varied, so trust your agent to help you get the best possible results, no matter what the market looks like.

Work With Us

Clients and cohorts alike, appreciate our unique combination of analytics, creativity, and calm leadership style. While working to manage, improve and buy/sell our properties, we realized we were drawn to the idea of helping others with their real estate needs.