“Seller’s Market”, “Buyer’s Market” – What Do They Mean?


There are many factors which affect the real estate market – interest rates, employment, investment growth, legislative changes and new construction, to name a few. All of these factors influence the real estate market in some way and directly affect you.


What is a Buyer’s Market?

In a buyer’s market, there are more homes for sale than there are buyers. This could be a result of high unemployment, fear of interest rate increases or other factors which make people think twice about moving up into a larger home or purchasing a home for the first time.

The advantage buyers have in a buyers’ market is that they can typically take their time and look at all of their options before buying. Buyers also have more options because sellers are more anxious to sell. Overall, home prices may go down in a buyer’s market.

What is a Seller’s Market?

In a seller’s market, there are fewer homes for sale to a larger pool of buyers. The factors at work could be sustained low interest rates, high employment rate, legislative changes which make it easier to purchase a property – events and conditions that make buyers think it would be a good time to buy a big ticket item like a home.

The advantage goes to the seller in a seller’s market. Typically home prices will RISE as buyers are quick to make an offer to secure the property. Sometimes buyers will compete for a property, driving the price above expectations.

Why use a REALTOR®?

REALTORS® are the first to notice whether we are in a buyer’s or seller’s market – their business is helping sellers and buyers with their real estate needs and any change in the market affects how they work with their clients and customers.

There is also a statistical measure REALTORS® use to determine what kind of market exists – it’s called the Sales-to-Listing ratio. In any given month or period, the number of sales is compared to the number of listings taken. If the result is 55% or greater – there are 55 sales for every 100 listings – it is considered a seller’s market. If the result is 35% or lower – that is, 35 sales for every 100 listings – it is considered a buyer’s market. Anything in between is considered a balanced market.

In our market area, and across the U.S., we are currently in a Seller’s Market.  Alot of agents, including myself, have pre-approved buyer’s but no houses to offer to them.  This is great news for the Sellers!  For the SELLER, this usually means less time on the market and more money for their home.  There are still other things that affect your home on the market such as pricing it right, making it appealing to the buyers, and choosing the right agent to get all of this done.  You can have the most beautiful home on the block but if you don’t have the right price on your house, it will sit on the market and you will usually end up taking less for your home than if you had priced it correctly when it was listed.  

Also, First Impressions are the BEST IMPRESSIONS!  It’s all about curb appeal and what your home looks like to the Buyer when they first see it.  Buyer’s will usually pay more and be quicker to put in that offer on your property if it is eye-catching.  What is in the mind of the buyer when they see a beautiful home that is well-priced?  They know that when they see this home, that there are other buyers out there as well that will be looking at it and they have the sense of urgency to get an offer on the house and secure the home for themselves and their family!  

Although we are in a SELLER’S MARKET, your home still needs to be priced right and tastefully decorated in order to appeal to the buyers in the market.  Because of the internet, people are more educated about the prices of homes.   You need an agent that can help you set the right price for your home by looking at comparable homes in your area that have sold and pricing your home competitively.  The agent needs to be able to tell you what you need to do to your home and property to make it more appealing to buyers.

Give me a call today and I will be glad to come to your home for a free, no obligation consult and let you know what your home is worth and help guide you in the Selling Process!

Rhonda Hagemore

Keller Williams Realty – Cullman