Watch my quick video on Understanding Your Local Real Estate Market
Many factors can influence the housing market; these include mortgage interest rates, inflation, employment figures and the economy. If you are planning to purchase or sell a home, it is good to know if it’s a balanced, buyer’s, or seller’s market.
A balanced market means about equal supply of homes and demand for homes. Home prices increases are typically in line with the average rate of inflation. There is a 3-6 month inventory of homes (meaning it would take 3-6 months to deplete the number of homes for sale at that given time, at the current pace of home sales). Homes are most likely selling for at, or close to, list price.
This is also known as a ‘soft’ real estate market and it favors those buying homes. This is due to an oversupply of homes, as more people are selling than buying. The advantage is that there is a greater variety of homes to choose from, typically at lower prices. You will notice that there are an abundance of real estate ads trying to attract buyers, and homes prices may be dropping. There is usually more than a six-month inventory of homes available.
It is known as a ‘hot’ real estate market favoring those selling properties, as more people are looking to buy properties than those willing to sell. Property prices typically increase, as buyers are prepared to spend more in order to get the home that they have set their heart on. Sellers are at an advantage as their homes sell quickly, and at a higher price than the long-term average inflation rate. You may notice that real estate ads decrease; inventory levels are traditionally less than three months.
What the market like right now?
One way to determine if it’s a buyer’s market or a seller’s market is to look at inventory (the number of homes for sale). If inventory is low, it is most likely a seller’s market… high, then a buyer’s.
Keep in mind too, that the real estate market can be influenced by the season. Typically, there are more homes for sale in June, July, and August. That means that it could be a seller’s market in the winter but a buyer’s market in the summer.
Market conditions fluctuate as well based on the area. Cities with a lot of available jobs and growing industries will often be a seller’s market, while those with struggling economies most likely favors buyers.
I monitor our local market conditions and have access to timely reports because of my real estate license and REALTOR® designation. I share vital info that helps you make the best home buying or selling decisions. Let’s talk soon about your home and neighborhood if you are on the fence about making a move.