What’s the Difference Between a Buyer’s & a Seller’s Market?
Depending on supply and demand, a real estate market is defined as either a buyer’s market or a seller’s market. How exactly do these two types of market differ? Find out here.
A Buyer’s Market
A buyer’s market occurs when there are plenty of homes available to purchase. The name comes from the fact that buyers have plenty of choice in these conditions, which makes it more difficult for homeowners to sell.
Selling a Home in a Buyer’s Market
In a buyer’s market, sellers need to be reasonable with their pricing. You may need to settle for less than you had originally wanted, especially if you want to sell quickly. In addition, it’s extra important to make your property appealing. You’ll need to invest time into cleaning the entire home, including the floors, windows, and siding. It may also be worth repainting, although it can be enough just to touch up areas that contribute to curb appeal, like the garage doors, mailbox, and trim.
Buying a Home in a Buyer’s Market
If you’re looking to purchase a home in a buyer’s market, you’re in luck. You’ll be able to take time to consider your options and think about whether you’re sure you want to purchase a particular property. There’s also a greater chance a seller will accept some of your additional requests when you make an offer.
A Seller’s Market
When few homes are available, it’s a seller’s market. The lack of inventory means high competition among buyers, who may need to offer more than the asking price.
Selling a Home in a Seller’s Market
Even though conditions are favourable for homeowners in a seller’s market, you should put in the effort to make your home as appealing as possible. This includes making basic repairs before you put your home on the market. You may receive offers that are quite a bit higher than your asking price, but take care: always check buyers are able to receive financing or have cash for the amount they are offering before you move forward. Decide which offer to accept based on factors including down payment size, contingencies, and a willingness to give you time to move after you close the deal.
Buying a Home in a Seller’s Market
To compete in a seller’s market as a homebuyer, you should seek pre-approval for a mortgage. This will show sellers that you can afford the home, which will make them more likely to accept your offer. In addition, consider making an earnest-money deposit when you make an offer. This will go toward your down payment if the seller accepts your offer — but you’ll lose the money if you decide to rescind your offer for a reason not mentioned in the contract.
There is something both buyer’s and seller’s markets have in common: you need support from realtors. Sherwood Park homebuyers and sellers can receive expert advice from Damon Bunting Real Estate Group. We can help you find your ideal property or connect you with people who will be interested in purchasing your property. Contact us to get started.