I wrote Keys to Home Buying Happiness and listed 5 points that I thought would help a buyer navigate the market. In this expansion I’m going to talk about understanding Market Trends.
Which direction is the Real Estate Market going now that you’re involved? Is it a buyer’s, seller’s or balanced market? Understanding this will help you work through your expectations both in what you hope to find in your next home and how you will negotiate the sale once you do.
A Buyer’s Market has an abundance of homes, a limited amount of competition and the chance to shop for homes without too much fear of someone else snapping up a good home when you find it. Rates are generally favorable and it’s common to negotiate the terms to the buyer’s favor.
A Seller’s Market has a limitedumber of homes, an abundance of competition and the need to act quickly, or meet a deadline with an aggressive offer. In this environment it’s not uncommon for a buyer to miss out on some great homes because someone else is willing to pay more or eliminate some reasonable protections in their offer.
A Balanced Market has reasonable inventory, enough buyers and sellers to keep inventory fresh, but things are moving. You can shop with some comfort, but not too much. There is competition, but depending on the strategy of the seller, you may not have to give up the farm to get a great home.
What affects the market? Largely it’s a mix of the local economy, supply, demand and changes in the area that are drawing more people in or out of a given local. It’s very important to realize that ALL REAL ESTATE IS LOCAL. While in some parts of the country, or even in a greater metro area it could be a seller’s market, that doesn’t automatically translate to others. There are often hot and cold spots in a regional market that can work for or against you. As an example, what if the city is a seller's market and the outlying areas balanced or a buyer's market? When you sell in the Seller’s market and get to buy in the buyer’s market you have an ideal circumstance. I’ve seen this happen a few times in my area. Provided the place you buy eventually catches up, it can be ideal.
Knowing the trends and factoring that into your shopping and planning, you can better achieve your goals and have a great experience.
Did you like this post? Do you know someone else who might? Do you know anyone who might benefit from our services? Please pass this along to family or friends or contact us, we love to help.
One stop Real Estate & Mortgage Services Serving Sammamish, Issaquah, Redmond, Bellevue, Mercer Island and the greater Seattle area.