The terms “sellers’ market” and “buyers’ market” generally reflect which side of the real estate transaction has the upper hand when it comes to negotiating. While sometimes the entire nation can experience one type of market or the other, it’s more common for market conditions to be tied to a region, a town or even a neighborhood.
Multiple factors can influence housing markets including the local job market, new construction that offers more options for homebuyers, the reputation of various school districts, mortgage rates, home values and national economic conditions.
How do you know if you’re in a sellers’ market or a buyers’ market?
While there’s no definitive answer to what type of market you’re in, typically there are indications that demonstrate which side of the transaction sees more favorable conditions. In a sellers’ market, home prices are usually going up, homes are selling quickly and there are fewer homes on the market. In a buyers' market, the opposite is true: home prices are flat or falling, homes sell slowly and there are plenty of homes on the market.
You can ask a real estate agent about your local market or check statistics such as how many homes are available, how many days homes usually stay on the market and whether prices are going up or down.
Seller strategies for any market
Even in a sellers’ market, homeowners need to clean and prepare their home to attract buyers. Pricing the home in line with market conditions is important, since a home that is overpriced may not get any offers and will eventually sell for less than it’s worth.
In a buyers’ market, homeowners need to be more strategic in their pricing, be prepared to negotiate and to offer concessions to buyers such as paying closing costs. No matter what market conditions are like, homeowners may want to consider hiring a concierge service like Revive to renovate their home in order to get a higher price.
Most home sellers are also buyers, so it’s wise to consider both sides of the transaction when you’re ready to move. Revive provides upfront funding so you have your cash available for your purchase. The renovation costs will be repaid when you sell your home, typically for a higher price than if you sold it without fixing it.
Buyer strategies for any market
In a sellers’ market, buyers need to be prepared with a preapproved loan, a higher deposit and a strong understanding of the market and their priorities since they may need to make a fast decision. In a highly competitive housing market, buyers may want to consider a cash offer program such as the one Revive offers. Essentially, you get preapproved for a loan and Revive makes a cash offer for the home you want. You can move into your new home before you sell your previous home.
In a buyers’ market, you have more options to consider and can take more time to make a decision. You can compare various homes and have more negotiating power. Just remember that you may not get everything you want, so you’ll need to set priorities for your home and your financing.
Whether you’re a buyer, a seller or both, Revive has the expertise to help you make the move from one home to another.