What do they mean?
A seller’s market is when the supply of goods or shares decreases as the demand for those goods increase. A consequence of this is rising prices, giving sellers the upperhand. The opposite of this would be a buyer’s market. Just reverse the conditions and the buyers have the advantage. The supply of goods or shares increases as the demand decreases, and now prices can stay lower; a better time to buy!
Factors that affect each market and your decisions:
-Consumer confidence levels
Why does this matter?
This all matters when you make your decision to buy, sell, or hold your house. It could affect the price you list or buy your house at and how long it lasts on the market. In a seller’s market with low interest rates during the summer, houses typically aren’t on the market for that long.
Statistically speaking, buyers come out of hiding during the warmer Summer months and line up to buy houses. This could be because the homeowners or agent can stage the house beautifully for pictures that better expose the house on a perfect day. It could even be the fact that it is summer and that makes people feel better, triggering a want or need to open up your wallet. You can’t forget about interest rates either! How cheap and easy it is to get a loan will also influence the type of market we are in. Lower interest rates incentivize spending and taking loans, so it is likely easier to get a loan at a lower rate. When it is harder, and costs more for a loan, people tend to clench their fists tight with their money in hand.
Certain markets can last months, even years! Whichever market we are in, people need a roof over their heads. Opportunities come and go, even in transitional markets (transitioning between seller’s and buyer’s market or vice versa), but it is always good to know what market you are in so you can get a better deal--buying or selling a property.
Looking to buy or sell a home? Have any questions? Need to work with a real estate pro? Call me at 707-480-9383
First time buyer? Get educated on the pros of homeownership! Call Eric Taggesell, VP of Mortgage Lending at Guaranteed Rate Affinity with all your questions regarding a mortgage. Office: 707-757-6195.