The real estate market in 2023 has certainly had its ups and downs. Individuals looking to buy and sell homes have been carefully tracking patterns and market trends that seem to never stop fluctuating. In this article, we will explore the current state of the real estate market and how to tell if we are in a buyer’s or seller’s market.
First and foremost, let’s explore what a buyer’s market is:
When the economy and real estate market favors the buyer, one of the key telltale signs of this is inventory overload. Inventory overload occurs when there is a surplus of homes on the market listed for sale. The market will be saturated with sellers looking for buyers to purchase homes, and buyers will have an abundance of choices.
Falling prices is another key telltale sign of being in a buyers market. Since there will be a surplus of homes available, sellers will start listing their properties at competitive prices to speed up the sale.
As a result of these falling prices, buyers will have more negotiating power. This means that they will be able to negotiate things like down payment prices, mortgage rates, and even improvements that must be completed prior to purchase.
The current market today is known for its higher interest rates. When we enter a buyer’s market, interest rates will start to fall, making it more feasible for buyers to purchase expensive homes.
Now it’s time to explore what a seller’s market entails:
When we enter a seller’s market, there will be a significant drop in available properties. Due to climbing interest rates and low negotiating power, sellers will hold off on listing their home and might invest money elsewhere. Examples include home improvements, new additions, and other upgrades. Sellers who wish to continue listing their property during this time will be exposed to a number of advantages.
In a seller’s market, speedy sales are the name of the game. Since buyers are fearful of losing out on the minimal properties available, they will want to close quickly on their desired home. Bidding wars are also common, as buyers want to snatch the property up before someone can swoop in with a better price.
Due to the lack of inventory yet study demand, home prices tend to increase when we are in a seller’s market. Individuals listing their homes for sale will likely list at a higher price due to the lack of supply in the market.
Buyers will also have less negotiating power when it comes to upgrades and home improvements when we enter a seller’s market. Sellers will notice an increase in as-is sales, so what you see is what you get!
While all signs point to the conclusion that we are in a seller’s market currently in 2023, this can change on a dime. If you are entering the real estate market as a buyer or a seller, be sure to monitor market conditions, track interest rates, and understand supply and demand.
For expert help in understanding the real estate market before buying or selling a home, contact our pros at VSells&Associates today!
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