In the real estate industry, there are different types of markets: neutral, buyer’s and the seller’s market. It all depends on who benefits the most from the market conditions. In this article, we will focus on the market where home sellers get the most benefit. As the buyer, especially a first-time homebuyer, you need to know how to navigate in this condition so you get the best deal.
There are signs to look out for in order to determine the conditions of the real estate industry. The market is known to be in the seller’s advantage if the following scenarios are evident:
Inventory is low. If the homes for sale is low – usually less than 6 months, then you can assume that it is a seller’s market. That time means it will only take less than half a year to finish off selling the homes currently listed (assuming there will be no additions).
Prices are rising. Another indication is the increasing median sale price. This is comparing the sale price of the current month to the past few months.
Homes sell quickly. Sellers benefit from homes that are sold quickly – so this is another indication. While it makes it very hard for buyers to get a hold of their ideal home, this is good news for home sellers.
Buyers are eager to close the deal. In a seller’s market, it is the buyer who is eager to close the deal just so the home is assured. This means the complete sales increase as well.
Homes sold have a time limit. If the agent puts a time limit to making offers, this means there are more than one offer for the home. That usually indicates a market that is lenient to sellers.
While you may think that buying in this type of market is at your disadvantage, you just have to know the right techniques to get that home that you have been eyeing. First of all, you have to come in prepared. That means you need a pre-approved mortgage. This helps the seller identify you as a serious buyer and will prioritize you over those who have none.
Most of the time in a seller’s market, a home gets more than one offer. If this is the case, you need to submit a noteworthy bid. That means you need to be careful about what you offer for the house you want to buy. It has to be based on actual figures and try not to offer too low. Most likely, you will be involved in a bidding war for the property so make sure the seller notices you in the competition.
In the event that a seller shows that they are interested in transaction with you, offer to quickly close the deal. Finishing the sale immediately will encourage them to listen to your negotiation.
In a seller’s market, you should also take caution as you negotiate. Remember that the seller has other offers. Accept the possibility that you will purchase the home at a higher amount than what you expected. Just make sure you don’t offer a price that you cannot afford. Always take into consideration your finances – including the closing costs and the other expenses that you need to make.
If you wish to know more about buying in a seller’s market, you can get in touch with the Guldi Group. It pays to know how you will conduct yourself in this market so you still get the best bargain.
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