Whether you’re determining the listing price of your home or planning to make an offer on another property, it’s important to first research the area to figure out whether you’re in a buyer’s market (where the supply outpaces the demand) or a seller’s market (where the demand is higher than the inventory). Knowing your market will give you a starting point and provide insight to what negotiating power you have. But what are the factors that go into determining whether a market favors the buyer or the seller? Where the buyer has the upper hand In a buyer’s market, there are more homes for sale than there are people looking to purchase them. This means a competitive market for sellers in which properties are listed at a lower price to entice buyers to make offers. Houses in these areas tend to sell for less and sit on the market for a longer period of time before receiving an offer. While it means a buyer may be able to pick up a home for a lower initial price, it also suggests that real estate values will appreciate more slowly. A buyers’ market has characterizations of a ratio of 11% or lower. Buyers’ markets in the US include:
Now on to where sellers have more control. With housing inventory down across the country, sellers in many areas have the advantage to list at the higher end of their property’s value. This tight inventory was caused by the 2008 market crash, as homes that would usually be bought by first-timers were scooped up by investors for cheap, taking many of those entry-level properties off the market. Since then, the market has begun to stabilize, but many in-demand areas that were hit hardest by the crash are still considered sellers’ market. In addition to the lingering effects of the crash, areas that are in demand due to a strong economy in the area and higher median incomes are generally considered seller’s markets. More people in the market to buy a home coupled with the scarcity of “starter” homes available means that buyers must be competitive with their offers in order to impress the seller, allowing sellers to demand higher prices for their homes. A seller’s market will typically have characterizations at or above 20% active listings. These areas are considered seller's markets:
A balanced market is where when there is a steady rate of homes being sold and, bought. Home prices in a balanced market sit between a 12 to 19% ratio. This is also who when prices stabilize. Contributed by James Link SetSchedule has changed the way real estate marketing is viewed, by changing the way REALTORS® access clients and listing appointments. SetSchedule is a “first of its’ kind” exclusive membership based model that provides verified appointments, marketing tools, and elite invite-only networking events for its members. By blending new technologies, and thought processes with proven success methods SetSchedule had incurred record producing results unseen in the industry.
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