The media has reported that 2016 is shaping up to be a seller’s market. Whether you are looking to buy or sell a home many industry terms can be quite confusing.
Let’s explore the terms buyer’s and seller’s markets. The type of market is defined by the amount of available inventory. Therefore, if a market is classified as a seller’s market that simply means that there are fewer homes available compared to the number of buyers.
To be considered a sellers market there has to be less than six months of inventory to satisfy the buying need of a given community. If the supply is between six to seven months then the market is deemed neutral; whereas, over seven months of supply, the market becomes a buyer’s market.
What does that mean for home prices? There is a famous saying that holds true across each real estate market;
There are still many factors that weigh in on the price of homes entering the market, and the location of a home is a huge factor.
Remember the old adage “Here today; gone tomorrow.” A seller’s market is still a great time for buyers to purchase a new home as home prices do not normally fluctuate tremendously between a seller’s and buyer’s market. However, homes entering are being purchased quickly…which means buyers have to be ready to act once their ideal home is available.
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