For much of the last several years, the real estate market has fluctuated. We've hit some highs and certainly some lows. Even with the given state of the world and navigating through this pandemic, the real estate market is on fire! We simply need more inventory. There are buyers waiting for more homes to hit the market. The lack of inventory, compounded with the low interest rates, have potential buyers ready to jump on properties. We are now in a sellers market!
So what, exactly, does “seller’s market” mean?
A seller’s market occurs when the demand for homes outpaces the available supply. One handy way to determine exactly when the market enters the “seller’s phase” is when the ratio of sales to listings hits 55-60 percent, or three sales for five listings. The opposite of a seller’s market is, of course, a buyer’s market, which is characterized by a ratio of fewer than seven sales per every 20 listings (below 35%).
What factors cause a seller’s market?
One major factor in spurring on seller’s market can be a drop in interest rates, which allows more people to qualify to buy homes, or to afford more expensive homes. Population growth and increased employment opportunities also bring more buyers into the market.
Yet another boost might come from new or expanded government housing assistance programs which allow for special low-interest loans, down payment assistance or tax credits for qualified buyers.
If you are thinking of selling, your first step should be to contact an experienced agent, like myself, to discuss the current market in more detail and create a marketing plan to take advantage of the seller's market I have been discussing.