Buying and selling real estate is a tradition that predates modern civilization. Since humanity understood the value of land (and currency), real estate trade has always happened. In our highly complex society, the deciding factors for matters like price, size, and more are becoming more standardized. Things such as a seller’s market and buyer’s market now exist. But what are they and what do they constitute?
The Buyer’s Market
In the event that there’s more supply than demand for it, a buyer’s market happens. Often, during low economic points, people stop buying real estate to focus on other, more pressing expenses. And because there’s plenty of properties to sell with fewer interest buyers, the willing buyers end up having more leverage. The real estate market is then forced to respond and adjust to the demands.
The Seller’s Market
Just as a buyer’s market is when there’s more supply than demand, a seller’s market is the opposite. When the demand for a certain item far exceeds the available supply, a seller’s market occurs. In such cases, real estate such as houses sell fast and buyers often have to bid and negotiate in order to land a sale. Sellers are often poised to sell to the highest bidder, as the increased demand would have multiple willing buyers competing for the property.
Strategies and Tactics
With the different economic environments come differences in how a buyer or a seller would approach a transaction. That’s why real estate agents are constantly refining their strategy: to adjust to the ever-changing market. Let’s take a closer look at what home buyers are looking for in a house during a buyer’s market, and how home sellers are selling their property during a seller’s market.
Selling During Buyer’s Market
Because vendors would have to compete to get a sale, it’s important to know how to generate interest and increase the value of your property. Here’s how.
Make Your Price Competitive
Buyers are very picky when it comes to pricing. Always be aware of the market price and be competitive with yours. Because there’s less room for negotiation, you need to have other ways to attract clients, such as more amenities in the property, or covering any repair costs.
Stack the Features
As mentioned before, one way to still generate interest during a buyer’s market is to have appealing amenities. If you’re strategic enough to leverage outside elements, such as selling a property near a burgeoning business district or taking advantage of the popularity of a location, you can still manage to get the buyer’s interest. Always look for ways to increase the value of your property through adding features or leveraging outside factors.
Make it Marketable
Ultimately, buyers are still humans subject to their own impressionable opinions. And during a buyer’s market, your marketing and ad work will show its value. Make sure the pictures of your property are professionally done, highlighting its positive points. With a professional photographer, you can bring out the value of your property and communicate with interested parties.
Buying During Seller’s Market
When you need to purchase a property in the time of the seller’s market, you need to be extra clever. Below are some tips to help you out.
Get Your Finances Ready
This goes without saying, but competition among buyers can be difficult during this time. That’s why it’s best to get either a mortgage loan or find a lender who’s willing to pre-approve you. You might even be able to find lenders who can pre-underwrite you, bolstering your chances of being able to pay as soon as you can.
Close as Fast as You Can
Should you find a property that you like at a price that you can manage, don’t think twice about closing it. Waiting for a “better time” might result in someone else buying it before you, and in such a situation, you would be left with nothing. That’s why the last piece of advice really comes in handy: it enables you to close quickly once you find a viable property.
Have Multiple Options
Even in a seller’s market, you can still shop around for the best value for your money. Don’t be afraid to put yourself in bidding wars, but don’t forget that that’s not the only property out there. Make sure to keep your eyes peeled for better options. You’ll find that there may be some properties that might not have everything you need, but covers the fundamentals of what you require.
Whether you’re a buyer or a seller, ultimately, you have to be patient. Just prepare everything, your finances, and your paperwork, and soon you’ll find the opportunity to either buy or sell.