Most of us have a cursory knowledge of real estate and how it works. Like most things however, we should probably leave it to the professionals. At the Chernov Team, we believe in keeping our clients informed, and part of being informed is being aware of common terms used in the real estate industry. Today we will address the terms “buyer’s market” and “seller’s market.”
It is critical to keep in mind that within the same state, and even within the same county, there are several real estate microcosms. Each of these microcosms have their own markets, which in turn impact the markets of neighboring counties. Ultimately then, with careful planning, you might be selling your house in a seller’s market while purchasing a new home in a buyer’s market. Having a knowledgeable agent on your side is the best way to maximize your profit by selling high and buying low. The agents at the Chernov Team keep their thumb on the pulse of all things real estate and are in a unique position to assist you in optimizing your transactions.
- What is a Buyer’s Market?
A buyer’s market exists when the supply of houses exceeds the number of people seeking houses; this may seem like common sense but identifying a buyer’s market can be challenging without the right skills, knowledge, and tools. Factors such as the time of year, changes in property tax, the prosperity of local business, and the addition of new homes in the area can all have an impact on whether someone chooses to sell their homes. When the weather is just right several sellers in one of those microcosms mentioned above may choose to put their homes up for sale to salvage the profit on their homes; this creates a buyer’s market. The ultimate effect of a buyer’s market is that sellers are forced to sell their homes at lower prices, they may have to incentivize buyers with favorable contract terms, and basically anything else that would encourage a buyer to purchase their home over the other available homes.
- What is a Seller’s Market?
On the other side of the coin, we have a seller’s market. This occurs when the supply of ready, willing, and able buyers exceeds the number of homes available for sale in a particular microcosm. The same factors mentioned above can have a positive impact on an area. When an area’s property values are increasing, it brings many potential purchasers to the area, seeking to make a sound investment. The net result of a seller’s market is that buyers engage in a bidding war, and the seller ultimately walks away with more than they would have had the market been calm.
The agents at the Chernov Team take great pride in assisting our clients, and we are always looking for developments that indicate an area becoming either a buyer’s market or a seller’s market. As mentioned above, it is entirely possible to sell your home high and purchase your new home low. Call the Chernov Team today.