Odds are if you're interested in real estate or you know a real estate agent, you've probably heard the terms seller's market and buyer's market. What do these terms mean and how should they impact your decision to buy or sell your home? Keep reading!
These terms describe the supply and demand of the current real estate inventory in a given area…
Seller's Market
A seller's market means there are more buyers than there are available listings to purchase, so the buyer demand for housing far outweighs the inventory that is available to buy. A seller’s market is a fantastic time to sell your home as you could secure a sale price that’s higher than your listing price. This type of market often creates an environment where there are often multiple offers on a given home, causing buyers to bid higher in order to be the winning offer. If you’re buying a home during a seller’s market, be aware that the seller has the advantage. You may end up having to pay more than list price to outbid other offers.
Buyer's Market
A buyer’s market occurs when the supply (available homes for sale) exceeds demand (the number of buyers seeking to purchase homes). During a buyer's market, it is a favorable time to purchase a home and make your move. This is because there are more homes available to choose from and not many buyers, so you as a buyer will have more negotiating power and may be able to buy a great home for a lower cost. Selling a home during a buyer's market means your home might not sell right away due to a large number of other available properties. You may also experience having to lower your list price to make your property more competitive and appealing to buyers.
How to Measure/Determine the Market
A way to measure whether we are in a seller's market is to look at available inventory, or the number of homes for sale. If the current inventory is low, it is most likely a seller’s market. If the current inventory is high, it is most likely a buyer's market. The real estate market goes up and down depending on the season. There are usually more homes for sale in the summer months than any other time of year. However, this is not always guaranteed and certain circumstances—such as the COVID-19 pandemic—can cause markets to have "out of the ordinary" circumstances.
If you are interested in buying or selling and are curious about what type of market Seattle is in currently, contact me today! I will walk you through current market data and will develop an action plan that makes the most sense for your current wants and needs.