Buyers Market or Sellers Market?
Are we in a buyers market or a sellers market? What is the difference? How do we know? How do we win in both markets? Read our blog to discover more.
the UK housing market is intricately linked to the fundamental economic principle of supply and demand. This relationship determines whether a given market leans towards being a buyer's or a seller's market. While certain seasons may witness fluctuations in foot traffic, the housing market exhibits significant variations from one neighborhood to another. I can assist you in discerning whether the current market favors buyers or sellers and elucidate essential concepts to communicate effectively with your clients.
Buyer’s Market vs Seller’s Market: Definitions
What Constitutes a Buyer’s Market?
Key Points:
- Buyer Leverage: In a buyer's market, buyers hold more negotiating power, leading to favorable terms.
- Strategic Home Search: The abundance of inventory enables buyers to be selective, emphasizing the importance of analysis to help them focus on their preferences.
- Standout Sellers: Sellers and their agents must concentrate on effective marketing, necessary repairs, and competitive pricing to distinguish themselves and attract offers.
- Preparation and Presentation: Sellers should concentrate on depersonalizing and decluttering their homes to appeal to a broad range of buyers.
In a buyer's market, the imbalance between supply and demand results in fewer buyers than available homes. This situation grants buyers some negotiation leverage, lowers competition for homes, and extends the days on market for listings. The metric used to identify a buyer's market is the speed of sale being agreed from initial marketing. A large number of properties exceeding six months traditionally considered indicative of such a market.
Characteristics of a Buyer’s Market:
- High number od properties sticking on the market
- Fewer interested buyers
- Willingness of sellers to negotiate
- Lower starting offers from buyers
Understanding a Seller’s Market
Key Points:
- Sellers' Advantage:Sellers gain the upper hand due to limited supply, leading to quicker sales and potential price increases due to heightened competition and scarce supply.
- Quick Buyer Decisions: Buyers must be well-prepared to make strong offers promptly due to intense competition.
- Strategic Pricing: Sellers should strategically price homes to attract buyers and potentially initiate bidding wars, causing price fluctuations.
- Seller Preparation: Despite the market favoring sellers, well-prepared listings, priced appropriately, and effectively marketed still attract buyers, potentially leading to quicker and more profitable sales.
A seller's market emerges when demand surpasses supply, presenting challenges for agents and homebuyers. In this scenario, sellers have the upper hand in negotiations, and the number of days on market is typically low. The benchmark for identifying a seller's market is the calculation of months of inventory, with anything less than six months traditionally considered indicative of such a market.
Characteristics of a Seller’s Market:
- Few homes for sale
- High demand with buyers competing to make offers
- Homes selling in under 30 days
- Increased cash offers
- Rising housing prices
- Limited home renovations
- Limited negotiation room for buyers
- Intense competition for homes
How to beat a buyers market
Properties are still selling in a buyers market, however you cannot get away without a plan. In a sellers market you will be inundated with enquiries and so only basic preparation is needed. When we are in a buyers market we need to make every effort to put your property in the best possible way and market correctly from day 1.
- Presentation: We need perfect presentation for photos and viewings, you only get one chance for a great first impression
- Price to entice: A correctly priced property will still sell for the marketing price and quickly however even if slightly overvalued it could sit for months.
- Spread the word: Time to not just rely on Rightmove, with properties sticking on the market your property can get lost in white noise and not noticed be your perfect buyer. An agent needs, more than ever to be on the phone speaking to buyers about your home.We sell countless properties to people who have ignored a property online but buy following our recommendation to view.
Selling in a buyers market is not rocket science, you need an agent who is totally honest with you from the start, one you can trust and happpy to work with. Selling in a tougher market needs a partnership between agent and client.
If you would like to sell your home please call me on 01525 713111.