What is a buyer-friendly market?
There has always been a lot of talk about the differences between a buyer’s market and a seller’s market. But probably never as much as in the last two years. Real estate markets are cyclical, but that doesn’t mean they always go in the same direction! They spin and stagnate at times. Understanding the real estate market is addictive but confusing. Sometimes expert predictions are wrong, and surprise turns in the cycle occur.
During the unprecedented pandemic crisis, we saw the market escalate into a hot seller’s market for a very long time. Homes with multiple offers, bidding wars, and selling for astronomical amounts of money over asking have shocked realtors, buyers, sellers and society in general. However, as quickly as the seller’s market peaked, the buyer-friendly market suddenly appeared.
A buyer’s market is not the same as a buyer-friendly market.
So what is the difference between a buyer-friendly market and a buyer’s market? A buyer’s market refers to purchasers having an advantage over sellers because there is an increased supply or decreased demand. Houses in a buyer-friendly market may still sell quickly but at asking or below, after more days on the market and without multiple competing offers.
A seller’s market is not the same as a seller-friendly market.
So what is the difference between a seller-friendly market and a seller’s market? A seller’s market happens when there is a shortage of homes available for sale or more buyers than homes. A seller-friendly market may still sell their home in a timely manner with relative ease but at a more competitive price, and not necessarily multiple offers.
Many people have been asking us lately,
“Is the market turning into a buyer’s market?”
“Should we look to buy in a buyer-friendly market?”
“Is it better to wait till it is a sure-fire buyer’s market?
When the real estate market is shifting, we like to call it a little friendlier for the other market that has struggled to push through!
While a seller’s market means there is less inventory than buyers, A buyer’s market means that there are more homes available to choose from. After a long and continual stretch of a strong seller’s market, in spring 2022, the shifting has begun to be a little more buyer “friendly.” This doesn’t mean that it is necessarily a buyer’s market or that the seller’s market is over, but the shift is sure making it less discouraging and frustrating for buyers.
It is not a perfect situation for buyers in a buyer-friendly market, but it sure is a drastic improvement from the unfriendly buyer’s market we have seen for the last while. However, our best advice in a shifting market becoming more attainable for buyers is to act fast. Here’s why:
With the interest rates beginning to climb with expert predictions indicating they will continue to go higher, there is no doubt that this can be discouraging for aspiring home buyers.
With the uncertainty of the “work from home” and hybrid office models, and the “great resignation” that has been occurring, many people are still flocking to popular areas to build roots in places they used to only dream of living in.
A market deemed a little more “buyer friendly” does not mean you will get amazing deals on purchasing a home anytime soon. As inflation and supply/demand issues continue in the aftermath of the global pandemic, the housing market will likely still see houses maintain their value or increase.
With the market as unpredictable as it is, getting preapproval for financing is a critical first step to help you be ready and able to act quickly and not lose out on your dream home.
We encourage potential buyers to get going as quickly as possible with a trusted realtor to access a more likely positive experience, more choices and less stress. A buyer-friendly market can change the process as well as the outcome in a positive way.
If you were sitting tight through a seller’s market, waiting for it to shift to a buyer’s market, we highly recommend you move swiftly when the market becomes more buyer-friendly. A shift in a seller’s market does not guarantee it will become a buyer’s market, so it could quickly cycle back to a seller’s market at any point.
We would love to chat with you about the strategies we intentionally employ with clients during a buyer-friendly market. Reach out to understand the real estate market better!
