What's the difference between a Buyer's Market and a Seller's Market? It's important to know the difference especially when it comes to negotiating on a home:
Buyer’s Market: There are more homes on the market than there are buyers. In this type of market, buyers will spend more time looking for homes due to a larger supply of homes available. Sellers will find that buyers have stronger leverage when negotiating;
Seller’s Market: There are more buyers than there are homes for sale. With fewer homes on the market and more buyers, homes generally sell quicker. Prices of homes are likely to increase, and there are more likely to be multiple offers on a home. Multiple offers give the seller negotiating power, and conditional offers may be rejected;
Balanced Market: There are the same amount of homes for sale and there is equal competition between buyers and sellers, this means that there are reasonable offers given by buyers and homes sell within a reasonable time. With less tension between buyers and sellers, the prices of homes remain stable.
Before buying or selling a home, it is important to find out what type of market you are entering into. Your listing price, negotiations and expectations will all be affected depending on whether it is a buyer’s market or a seller’s market.