You’ve probably heard the terms ‘buyer’s market’ and ‘seller’s market’ thrown around a lot as a real estate investor. Being able to tell the difference between the two in the housing market is very important. Continue reading to figure out which market is best for you!
First, let’s clarify what a buyer’s market and a seller’s market is.
A buyer’s market is a real estate market which is in favor of the buyer. This market occurs when the supply of investment properties exceeds the demand. What this means for a real estate investor is that there are a lot more real estate properties available for sale in the market than there are buyers seeking to buy these properties. If you’re trying to buy a property, you could get the best real estate investments at lower costs.
However, if you’re trying to sell an investment property, your property might stay on the market for quite a while. You might be providing a great property at a good price, and it might still stay on the market because the current housing market favors buyers. This could lead to you selling the real estate property below the fair market value just to secure a buy. So, do some research before putting a property up for sale in a buyer’s market.
Now the market has turned around and is in favor of the seller! A seller’s market is a housing market with the demand for real estate properties exceeding the supply of them. This is a market full of potential buyers who are looking to buy, but there aren’t enough properties available in the market. This is a great opportunity for a real estate investor who is selling an investment property because in a seller’s market you usually have multiple buyers interested in the same property. This gives the seller leverage to sell properties at higher prices due to all the willing buyers available.
If you’re planning on buying an investment property in a seller’s market, you should keep a couple of things in mind. You probably won’t be able to negotiate down to a low price. Quite the opposite, actually you might have to put in an offer that’s higher than what you expected. There aren’t many real estate properties available for sale, so you need to be prepared to act quickly if you choose to buy a real estate property.
How to Determine: Buyer’s Market vs. Seller’s Market
Okay, so now that we’ve explained what a buyer’s market and a seller’s market is, we can move on to the details. You know what each one is, but let’s discuss the several ways to point out what kind of housing market you’re in.
The housing market, like any other market, has certain trends that go up and down. Real estate properties typically go up for sale a lot more in the summer season and less in the winter. If you’re a real estate investor interested in buying a property, check out the property listings in your area first. The same applies for a real estate investor interested in selling. You can do this in no time if you visit Mashvisor and conduct a real estate market analysis online! Mashvisor will help you figure out how to buy an investment property and how to sell an investment property with our numerous tools. You can also easily find the properties listed for sale in your area. If there aren’t many real estate properties listed, then you’re probably looking at a seller’s market and vice versa.
To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.
How Real Estate Agents Can Help in a Buyer’s Market or Seller’s Market
A real estate agent is someone who helps and advises a property buyer and/or a property seller throughout the transaction process. So, whether you’re buying or selling, a regular homeowner or a real estate investor, a real estate agent can help you. Real estate agents are licensed professionals who can negotiate and arrange the buying or selling of an investment property for you.
Real estate agents can help you formulate the best investment strategy whether you’re in a buyer’s market or seller’s market. In real estate investing, the right real estate agent can help you come out on top.
If you’re a buyer, a real estate agent will find the best properties for you, matching your price range and tastes. This can also higher your chance of getting the property you want in a fast paced seller’s market.
If you’re a real estate investor interested in selling an investment property, an agent can also help! They can help prepare the property for sale and will advise on what the best selling price is. If you’re selling in a buyer’s market, a real estate agent can help you attract buyers. They can help draw focus towards your property instead of the other properties in the local housing market. Make sure to choose a real estate agent you trust to insure that your best interest is in their mind.
Mashvisor can also you in this regard by connecting you with the top real estate agents in your local market.
The Bottom Line
Real estate investing has a number of different factors to consider. The current state of the local housing market is one of the major factors to analyze before deciding whether to buy or sell an investment property. It being a buyer’s market or a seller’s market can make all the difference for the desired investment outcome. There are many ways to analyze the real estate market and figure out what kind it is. Don’t forget the best situation for a real estate investor as a buyer is being in a buyer’s market. The best situation for a seller is to be in a seller’s market. Learning what kind of market you’re in is key. It can be as simple as driving through your neighborhood and seeing how many ‘For Sale’ signs are up. Or it could require a bit more effort like conducting a real estate market analysis or hiring a real estate agent. Either way, Mashvisor is a great alternative that you can always rely on.
To learn more about how we will help you make faster and smarter real estate investment decisions, click here.