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If you are starting a search for a new home or listing your current home for sale, you have probably come across the terms “buyer’s market” and “seller’s market.” Does that mean you have to list your home in a different place? It is a special way of marketing? What exactly is a “buyer’s market” versus a “seller’s market?”
A buyer’s market simply means that the real estate market, or trends in real estate transactions, tend to favor buyer’s over seller’s. That means that buyers, those in search of a home to purchase, have more negotiating power. This may mean that prices are lower or sellers have to provide more incentives, like credits or high-end finishes, to attract potential buyers.
So if a buyer’s market favors the buyer, who does a seller’s market favor? That’s right—the seller! In a seller’s market, home prices tend to be higher and seller’s can expect multiple offers on a property that is priced well. Potential buyers may even get into a bidding war where they each keep increasing their offer price to try to get the seller to agree to sell to them. there are larger trends across real estate around the country (example, the real estate crash in 2008), markets can vary by region and even within a particular area.
Which market is better for real estate? It really depends on your individual situation. If you are in the market for a new home, a buyer’s market will work in your favor. But, if you are also trying to sell your current home, that same market will make it more difficult for you to sell your home for top dollar. Whether you are planning to buy or sell, a seasoned realtor can help you learn about the current market and what you can expect.