Understand Market Conditions
The real estate market is in constant flux, not only as a whole but in particular areas as well. Knowing what is going on in the overall and local real estate markets will help you understand how these conditions can affect the sale of your home. We've designed the following chart to help give you an overview of the three significant market positions. When you meet with your agent, ask about the current state of the market.
1. Buyers' Market: The supply of homes on the market exceeds demand.
Characteristics: High inventory of homes. Few buyers compared to availability. Homes usually stay on the market longer. Prices are stable or perhaps dropping.
Implications: Buyers spend more time looking for a home, and when they negotiate, they usually have more leverage.
2. Sellers' Market: The number of potential buyers exceeds the supply of homes on the market.
Characteristics: There is a smaller inventory of homes with many buyers. Homes sell quickly. Prices usually increase.
Implications: Prices may be higher or perhaps climbing. Buying decisions must be made quickly. Conditional offers may be rejected.
3. Balanced Market: The number of homes on the market is roughly equal to the demand.
Characteristics: Demand equals supply. Sellers accept reasonable offers. Homes sell within a reasonable time period. Prices generally remain stable.
Implications: There is less tension among buyers and sellers. There is a reasonable number of homes to choose from.