Knowing the difference between a buyer’s and seller’s market is important when buying or selling a home. So, what are the differences and how can you tell which market is currently active? Keep reading to find out.
Signs of a Buyer’s Market
The top three signs of being in a buyer’s market are;
- A lot of homes on the market
- Prices dropping
- Homes staying on the market for longer than 3 weeks.
To put it simply, a buyer’s market is when there are more homes for sale than there are people looking to buy. In this type of market, buyers can spend more time looking for homes, as there is less competition. Houses take longer to sell, and as such, during a buyer’s market, prices on homes will also drop. This is because sellers must be more competitive if they want to sell their homes faster. Buyers will generally also have more leverage when negotiating as sellers have fewer potential buyers.
Signs of a Seller’s Market
The top three signs of being in a seller’s market are;
- Not many homes on the market
- Prices increasing
- Bidding wars or auctions becoming commonplace
When it is a seller’s market, you will notice that options for buyers are limited when looking at listings. This is because there are more people looking to buy than there are sellers. In this market, housing prices are higher and there are often bidding wars happening behind the scenes. As there are usually multiple offers, the seller has the advantage and negotiating power.
Before you look at buying or selling a home, you should consider what the market is like. Selling during a seller’s market allows you to get more for your home, but it will also make finding a new place difficult. Whereas in a buyer’s market you may find a home easier, but, selling your current home for the price you want may be challenging. Of course, there are always other factors at play, such as location, season, and condition of your home.
To learn more about the current market and discuss buying or selling, contact one of our expert agents today.