When you hear someone say that we’re in a “sellers’ market” right now, do you know what that means? Do you care?
If you’re planning on buying or selling in the foreseeable future, it wouldn’t hurt to have a introductory idea of what that means. Allow me drop a little bit of knowledge on you.
In the Greater Philadelphia area, that’s Philly and the surrounding counties, we are in the midst of a sellers’ market. In basic economic terms, the demand is higher than the supply. Feeling like you should have paid a little more attention in Econ 101? Basically, there are more buyers out searching for homes right now than there are sellers ready and willing to sell their homes. So inventory is low while demand is high.
There are several reasons for this dearth of inventory. Previously, the average homeowner stayed in their home for 7-10 years before moving, either to a different location or upsizing or downsizing their home. That’s not always the case these days. For example, many more seniors are choosing to age in place, staying in their homes longer. Also, we are still seeing the effects of the housing bubble from the early to mid 2000s. Many homeowners are still struggling to build equity in their homes after paying an inflated purchase price. So rather than moving, they are staying in their home to build equity. And investors scooped up many homes that were lost to foreclosure or short sales, which they then converted into income producing rental properties. So while the average homeowner might have moved on by now, investors will hang on to these homes and not release them back into the market.
Couple those factors with interest rates that are still at almost all-time lows, and it’s easy to see why we sometimes see buyers fighting over a property like it’s a Black Friday Doorbuster Blue Light Special.
But what does it all actually mean for you? How will it affect your home buying or selling process? Let’s break it down.
If you’re selling, your first step is to carefully develop a game plan with your Realtor, aka me, and to listen to my advice when it comes to a listing price range and staging tips. And because every property is unique, I will develop a unique marketing plan for your home to put its best foot forward right from the start. Once your home is on the market, you can expect a shorter than normal marketing period as long as you’ve followed your Realtor’s recommendations. Because demand is higher than supply, you can also expect to have a little bit more leverage throughout the negotiation process.
In a nutshell, listen to your Realtor, put your home’s best foot forward, and enjoy the sellers’ market!
If you’re buying, it’s not the end of the world to be a buyer in a sellers’ market. It just means that your home buying process is going to look a little bit different than it would during a buyers’ market. What you need is a seasoned, experienced Realtor, aka me, to give you an edge on the competition, aka those other buyers out there trying to sneak in and buy the home of your dreams. I will give you an edge by setting you apart from those other buyers and help you to put your best foot forward.
As a buyer in a sellers’ market, you’ll need to be ready to bring your A game before you ever put boots on the ground and start looking at houses. I will sit down with you, and in most cases, with your lender, to come up with a solid game plan. And remember, you’re probably not going to be able to sweep in and “steal” a house with a super lowball offer. You’ll need to be open to listening to advice and remember that my job is to find you the best house, for the best price, in the best location, for the best terms possible.
In a nutshell, listen to your Realtor, put your best foot forward, and a sellers’ market is no match for you!
Ready to discuss your game plan for buying or selling? Drop me a line or give me a call and let me know what your questions are!