Understanding Buyer’s Markets vs. Sellers Markets
Buyers markets and sellers markets come down to supply and demand.
In a buyer’s market, supply exceeds demand. In other words, the number of homes for sale is greater than the number of buyers looking to purchase those homes. Since there are more homes than buyers, there is less competition for those homes, the buyer has more choices available to them and they have more power to negotiate with sellers, which typically comes in the form of lower home prices and seller concessions.
In a seller’s market, demand exceeds supply. Or, in other words, the number of buyers looking for homes is greater than the number of homes for sale. Since there are more buyers than homes, there is more competition for those homes, so home sellers have more power to negotiate with buyers. This typically comes in the form of contingency-free contracts and bidding wars that drive up home prices.
In conclusion, there are advantages and disadvantages to both buyer’s and seller’s markets. If you are preparing to sell, or are in the market for a new home, please feel free to reach out to me with any questions you may have.