Are you looking to move? As a seller, you want to be sure to list your home when values are high. Conversely, as a buyer, you ideally want to purchase a new home at the best possible price. You may even find yourself trying to sell one home and buy another at the same time. Whatever the situation, understanding current real estate market trends can help you determine how successful you might be and what target prices to ask or offer.
What is a Seller’s Market?
The real estate market is considered a seller’s market when there are more buyers than available homes. When it is a seller’s market, it means many bidders compete for the same properties. Therefore, bids are often driven higher, perhaps even over the asking price. In a seller’s market, sellers often find their homes sell quickly.
What is a Buyer’s Market?
A buyer’s market occurs when there are many available properties but comparatively few potential buyers looking to purchase them. In that type of situation, sellers are at a distinct disadvantage. They must find ways to attract buyers to their properties specifically. Many sellers lower the asking prices for their properties as a way to sell them faster when market trends run in that direction.
Factors That Can Influence the Real Estate Market
The main factor that influences the state of the real estate market is supply versus demand. However, there are several secondary issues that can alter supply and demand figures. For example, the COVID-19 pandemic caused many employees to begin working from home. Several buyers entered the market when that occurred because they realized they could live in rural areas and not worry about longer commute times.
Other possible market influences include the following:
- Weather patterns/season changes
- Tax rates
- Building material availability
- Interest rates
- General economic states of specific areas
How Can You Tell What the Current Real Estate Market is Like?
One of the easiest ways to tell what the current real estate market is like is to consult with a real estate agent. He or she can often tell you exactly what the current market status is. However, you can get a sense of the real estate market on your own as well.
All you have to do is examine how long the houses in your area have been listed on the market. Check to see if the asking prices of those houses have been reduced. Also, take note of how many homes are for sale in the vicinity.
Choosing When and How to Buy or Sell Your Home
The ideal strategy for home buying or selling is to buy a home during a buyer’s market, and sell a home during a seller’s market. If you must buy or sell at an undesirable time, choose your methods wisely. Set yourself up for success as much as you can.
As a seller, you may consider making property repairs, staging the home, and being honest to maximize the chances of making a quick sale at any time. If you are the buyer, make sure you are knowledgeable regarding recent sales of comparable homes in the area. That can give you negotiation power during your own real estate transaction.