It’s important for both buyers and sellers to know what type of market they’re getting into when pursuing their real estate journeys. Put simply, there are TWO types of markets, a buyer’s market, and a seller’s market.

In a buyer’s market, there are more homes for sale than there are buyers. This means that the negotiating power is on the buyer’s side, and they usually can score a great deal because there aren’t enough buyers to go around. Even if the seller won’t agree to the terms, the buyer can easily move on to the next home. This inclines sellers to accept low-ball offers, pay for closing costs, etc. Here are some signs that it’s a buyer’s market:

– Properties sell for below original listing price with multiple price cuts
– ‘Days on market’ average increases
– Population and job growth trend downward
– Sellers offer incentives to buyers (new flooring, paying for closing costs, etc.)

In a seller’s market, there are more buyers than there is property for sale. When this occurs, home prices rise, property sells for full asking price or higher, and bidding wars with multiple offers become commonplace. Sellers have the power here, and can sift through multiple offers to find the one that suits them the best. Here are some signs it’s a seller’s market:

– Less homes for sale
– More FSBO (for sale by owner) signs because sellers are confident their home will sell itself with the high demand of buyers
– Homes selling before they are even listed
– Homes spend less days on the market
– Job market is growing due to business expansions or relocations
– Infrastructure and retail projects are underway

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