The Difference Between a Buyer’s Market and a Seller’s Market (and How to Capitalize on Both)
Knowing when to buy or sell a house is tricky. Of course, certain periods of time are referred to as either a “buyer’s market” or a “seller’s market,” but other than a general statement about who has the edge, what do these terms really mean? But what if you are a buyer in the seller’s market or vice versa? Here’s what you need to know.
What is a buyer’s market?
Ultimately, market type dictates which group has the most bargaining power, so in a buyer’s market, those looking to buy a home tend to have better choices and get more bang for their buck. This is because there are more homes for sale than interested buyers .
According to Forbes , potential causes of a buyer’s market include:
- economic downturn
- Major employer leaves region
- High or rising crime rate
- perestroika
What is a seller’s market?
There are many people in the seller’s market who want to buy houses, but there are not enough houses for sale to meet this demand. The housing shortage means homes sell quickly once they’re listed for sale and could go for a higher price than expected if multiple buyers end up in a bidding war.
How to benefit from any type of market
Even if the housing market is currently not in your favor as a buyer or seller, there are ways you can still make the most of it .
For example, if you’re not getting anything from selling your home to a buyer’s market, you can take the opportunity to make small upgrades or repairs to your home to make it more attractive to buyers. It doesn’t have to be something costly or drastic – simply removing personal/family photos from walls, decluttering, or doing some simple landscaping can make all the difference in the end.
On the other hand, if you’re a buyer at a seller’s market, keep visiting open houses and exploring the area. The more chance you get to see, the better idea you’ll have of what you really want, rather than just buying something just because it’s available.