A Seller's Guide to Real Estate Market Conditions

By Home Bay

Posted on September 6th, 2016

Perhaps you are in the market to buy a new home or maybe you need to sell your current home. Whether you identify as a buyer or seller, you need to understand how supply and demand work in tandem to create three types of real estate markets. Doing so will help you make a savvy investment decision. Let’s take a look!


Buyer’s Real Estate Market – Definition and What to Expect:

A buyer’s market refers to a real estate market where the housing supply exceeds demands. In this type of market, the buyer has the advantage because they are able to negotiate a low price more aggressively.

Buyer benefits:

  • Get more house for your money with lower purchase prices
  • Buy a home you wouldn’t necessarily be able to afford in different market conditions
  • More options; more inventory means buyers have more to choose from
  • Reduced prices; sellers get anxious to sell and start reducing their prices to appeal to more buyers

Seller’s Real Estate Market – Definition and What to Expect:

A seller’s market is the opposite of a buyer’s market. In a seller’s market, there are typically more buyers than there are homes for sale. Since the supply is lower than demand, buyers are typically at a bit of a disadvantage.

Seller benefits:

  • Getting more money for your home at closing
  • Potential bidding wars between interested buyers
  • A faster sales timeline; move more quickly from listed to sold”

Transitional Real Estate Market – Definition and What to Expect:

A transitional real estate market refers to the interim period between a buyer’s or seller’s market. This period of time is generally pretty neutral, meaning it’s neither good nor bad for buyers and sellers.

What to expect in a transitional market:

  • Sellers can “play the market,” and wait for the perfect offer; it may take longer than it would in a hot seller’s market, but there’s enough demand to allow sellers to wait for an offer at a good price
  • Buyers will have a moderate amount of inventory to choose from; there won’t be as many houses to choose from as there would be a buyer’s market, but the inventory will be better than it would be in a seller’s market

Whether you are looking to sell your home or need to buy a new home, understanding the three most common types of real estate markets will help you to make an informed decision on when to pursue your real estate goals.

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Posted in Real Estate Market