When you want to sell your house, it might surprise you to learn that there are times when putting it on the market is going to result in a quick sale. But another time will lead to your home sitting on the market for months without an offer.
Most homeowners more often that not, do not understand how they can tell if it is a buyers’ or sellers’ market. This is something that an experienced real estate agent can tell you by showing you the most recent data on what is going on in your area.
You must keep in mind that the data for one city or town may not mirror what’s going on in another. You can have a buyers’ market in one city in a state and a sellers’ market in another city in the exact same state.
The difference will come into play when a property can or cannot be moved. This is something that I use my tools, through professional subscriptions, that are only accessible as a licensed Realtor. You may discover some of these answers but be aware they can be misleading at times.
Selling a house works just like any business does. It is based on supply and demand. When you have a lower inventory than you have customers, the demand in a normal market is high.
So that means that it is a sellers’ market. This market can also change even within the same town or city. One neighborhood might be a sellers’ market while a neighborhood a mile down the road will be a buyers’ market. This was something Del Webb experienced June 1st, through June 22nd. Buyers were quickly moving to Florida from the Northeast to get away from the COVID-19 hot spots. Well they brought it with them.
Other things can sway the type of market we are in. Amenities that the area offers and the cost that you have to sustain these under a Homeowners Association and/or Community Development District. If it has what people are looking for, that can also affect and alter the market.
Some things that change a market are which school district the home is in, proximity to places of convenience, and desirability of the area. A market can also be influenced by the selling price of the house. I have experienced sellers that just want to sell and will accept any reasonable offer. This effect the overall value of homes in a specific community.
Homes in a certain price range may be more in demand that other a different model home has to offer. If a buyer has a lot of homes to choose from in the area that he or she wants to be in, then it’s a buyers’ market.
If there are few homes in that area, then it can be a sellers’ market. You can figure it out by asking your agent or you can go online and look at the number of homes that are for sale in your area. However, the online data is not always accurate.
Check to see how many of the homes have a sale pending. When you divide the listed properties by the contracted ones, that will tell you the sales rate or the number of inventories that is moving versus the amount on hand. If it takes homes less than three months to sell, that’s usually a sellers’ market.
Whether we are in a sellers’ market or a buyers’ market I tend to suggest that my sellers get a Home Inspection prior to placing it on the market. This helps when you close a CASH offer quickly, and it also helps you put out any RED flags in discovery.
You ask what is the importance of this? You eliminate any potential room to negotiate a lower sales price at closing. Never give the buyer an open opportunity to leverage you down on the sale price. At the end of the day, and you finally close on your property, everyone walks away happy!