BUYING IN A SELLER'S MARKET
10 May 2021
What is a Seller’s Market, Anyway?
In a Seller’s Market, there are more Buyers than there are homes for sale. With fewer listings to choose from and more competition, homes typically sell quickly, often seeing multiple offers or even bidding wars, and selling over asking price. In a seller’s market, the seller has the upper hand. This is not the time to test your
low-ball offer skills.
In a Buyer’s Market, there are more homes for sale than there are buyers. Since there is less competition, buyers can take their time shopping the market and have more negotiating power.
The price of homes listed for sale can be stable or falling.
In a Balanced Market, there is an equal number of buyers and sellers, resulting in reasonable offers and average days on market.
Less tension between buyers and sellers results instable home prices.
How Do You Buy A Home In ASeller’s Market?
Having a handle on market conditions is a key first step in a successfultransaction. This is the case regardless of market conditions, butespecially if you’re trying to buy a home in a seller’s market.Remember, Real Estate is very local, so what is happening in oneneighbourhood may not be the case in another. Here’s where it helpsto tap into a professional, experienced real estate agent.
KNOW YOUR BUDGET
How much can you afford to spend on a home? This is different from
a mortgage pre-approval. Take into consideration your lifestyle, andwhat sacrifices you’re willing to make. If you’re planning to buy morehome, you might have to curb your spending elsewhere. If you won’tbe making any lifestyle changes in interest of homeownership, youmay have to lower your home-buying budget or make some other concessions, such as the size of the home or the neighbourhood.
TIP: Get pre-approved for a mortgage. This gives you an idea of howmuch a lender is willing to finance, and how much you can spend. Apre-approval also locks in the current interest rate for up to 120 days, soyou can shop with the peace of mind that you’re insulated from ratehikes in the near future. If the rate drops, your lender should honour the new lower mortgage rate when you’re ready to make your purchase.
BE PREPARED TO ACT FAST
If you’re hoping to buy a home in a seller’s market, you’ll need to takequick and decisive action when you find a property that interest you.This is where all your prep work (see above!) will pay off.