Supply and demand form a powerful relationship in the marketplace, especially when it comes to real estate. Whether you’re in a buyer’s market or seller’s market can make a significant difference in local prices and whether homebuying is within your reach. Here's a look at the differences between buyer’s and seller’s markets and how they can impact your search.
What Is a Buyer’s Market?
A buyer’s market develops when there are more houses on the market than interested buyers. This might occur in a recession when most people don’t feel confident in purchasing real estate. A sudden local market shift can also lead to a sudden increase in inventory.
Competing for buyers forces sellers to cut prices, and properties may linger on the market for months. In these conditions, sellers are more willing to make concessions or negotiate to attract interested homebuyers.
A Guide to a Seller’s Market
When there are more people interested in homebuying than properties available, prices go up, and properties sell more quickly. These conditions, known as a seller’s market, are often driven by economic growth that gives more buyers the ability to purchase a home. Local investment activity can also reduce home inventory, so buyers must compete for every home that goes up for sale.
The pandemic recently caused a significant shift toward a seller's market. As more Americans began working remotely, many moved to smaller cities and suburban areas, purchasing homes at a rate that quickly reduced inventory. Since new builds slowed dramatically during this time, the supply has dwindled.
If you’re in a seller’s market, prices may continuously go up, and homes often sell very quickly. Some properties may even sell as soon as they’re listed, which can be frustrating for buyers without a real estate agent. You might also find yourself in bidding wars with other buyers, so successfully purchasing a home in a seller’s market often requires professional expertise.
Since 1927, Fletcher Bright Realty has been guiding buyers and sellers alike through the ups and downs of the market. Whether you’re interested in homebuying or listing a property in the Chattanooga, TN, area, their agents will help make your dreams a reality. Visit their website to browse properties for sale today, or call (423) 752-0188 to learn how they'll make homebuying easy.