A lot can be determined about the conditions of a local real estate market on the basis of supply and demand. When the supply of available homes exceeds the demand, we speak of a buyer’s market. Lower listing prices, longer days in the market and a higher number of new offers are also signs of a buyer’s market. While the current market is far from favorable for buyers, it’s a good idea to understand how a shift in conditions can affect your looking for a new home when the time comes.
A buyer’s market creates ideal conditions for those looking for a home. With more homes on the market than buyers, sellers have to compete to get their attention. In a buyer’s market, inventory is high, meaning buyers can take the time to find the right home because there is simply more to choose from. It often happens that homes are for sale for a longer period of time. Sellers will sometimes have to lower their price to gain a competitive edge, a selling tactic not nearly as common in warmer markets. Talk to your Windermere agent about current home prices, sales and inventory figures in your area to get a sense of your local market conditions.
How to approach a buyer’s market?
Obviously, a buyer’s market favors buyers, but how can they leverage this advantage when exploring available offers? First, buyers can be picky when it comes to finding the right home. Unlike the seller’s market, buyers have the luxury of weighing comparative advantages between homes, knowing that time is on their side.
The terms of a buyer’s market are also favorable to the buyer when it comes to negotiations. Because fewer people are buying a home, sellers are willing to be more flexible during the negotiation process, which gives buyers leverage. This underlines the benefits of working with a buyer’s agent. Buyer’s brokers deliver significant value to the clients they represent in their ability to find the right home, streamline the buying process, and handle the negotiation and offer phases of a home purchase.
if you are sell a house while looking for a purchase, you probably have the option to make your offer dependent on the sale of your existing home, while in a seller’s market, there is a small chance that a conditional offer will be accepted. Conditional offers can be tricky, but done correctly means you don’t have to buy if you can’t sell.
When a real estate agent sees that a home has been up for sale for quite some time, it will fuel their ability to negotiate a lower price. In these market conditions, there is little chance that buyers will find themselves in a bidding war or that a home will suddenly be sold overnight to a competing bid. However, once buyers have identified their best home candidate, they should work with their real estate agent to form a strategy for making a successful offer.
Sellers will do their very best to make their homes stand out from the large number of listings available. It is common that they make repairs, upgrades and other improvements to their homes before being marketed to entice buyers. Accordingly, a buyer’s influence in negotiations carries through to contingencies, where they can work with their agent to negotiate repairs — a proposition that sellers will be more open to given the limited number of buyers.
The conditions of the buyer’s market place the buyer in a favorable position in finding the right home. For more information about how to increase your purchasing power, talk to your Windermere agent. If you would like to learn more about your local market conditions or buy a home, contact a Windermere estate agent here: