Sioux Falls, South Dakota 57108, United States
Buyer's vs Seller's Market
How To Differentiate Between a Buyer’s and Seller’s Housing Market
Knowing the type of housing market your local community is experiencing helps you develop your strategy for buying or selling.
A buyers’ market gives buyers negotiating power because the inventory of homes for sale is greater than the number of potential homebuyers. Signs of a buyers’ market include a longer time to sell, selling below the listed price, decreasing market value, and a substantial inventory of homes.
The following strategies are recommended for homebuyers:
- Know what you want in your home. When you find that home, be prepared to offer only slightly below the asking price. If you have several choices to your liking, the seller will likely lower the cost to close the deal.
- Another buyer market strategy is to assume the seller will likely agree to concessions, such as paid closing costs, flexible closing dates, and the inclusion of specific appliances or other personal items in the home.
- Ask the sellers for obvious repairs, those noticeable without a home inspection, such as new shingles, new carpet, or a few windows replaced. Unless the home is listed to sell as is, most sellers will agree to repairs to sell it at or near its market value. If you are a first-time homebuyer using FHA financing, there are requirements in which case the seller has no option but to fix those items.
A seller’s market gives sellers negotiating power because the inventory of homes for sale is less than the number of homebuyers. Characteristics are limited inventory, home price increase, and homes selling quickly, at or above list price. There are strategies sellers can initiate to get the best price for their home. They are:
- Listing your home at market value increases buyer interest and likely supports the appraised value, ensuring buyer mortgage applications are approved.
- Understand that the best offer is not necessarily the highest offer. Knowing that the best offer includes a cash buyer or a pre-approved buyer with proof of funds to purchase. These qualifications have little hassle and a higher likelihood of closing on time.
- In a seller’s market, it is important to have your next home in the works. This way, if you receive an offer with cash, you can close within two weeks. A conventional mortgage will require contingencies, with a projected closing 30 – 45 days from the acceptance of the agreed purchase contract and contingencies. Not a lot of time to find a home for yourself.
Source: https://www.forbes.com/advisor/mortgages/sellers-market-vs-buyers-market/
Don Dunham III Real Estate
Sioux Falls, South Dakota 57108, United States
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