How to Buy a Home in a Sellers’ Market

A sellers’ market sure sound ominous to buyers, but it’s actually not too scary. Sure, there’s extra work and a whole lot of patience. However you can get through it and find a great home, if you’re willing to be realistic. It’s really about your expectations. (And, this applies to any market condition.) So, let’s take a quick look at what a sellers’ market is and how you can best conduct your home search.

Signs of a Sellers’ Market

A sellers’ market — as you might imagine — is simply when there are more buyers than homes for sale. It’s a classic example of supply and demand. There are fewer homes actively listed for sale than there are active, serious buyers. What real estate professional look to is the months’ supply of inventory. This is the time it would take to sell all active listings without new listings coming onto the market.

“What is a seller’s market? Simply put, it’s a market where there are more home buyers than sellers. Based on basic laws of supply and demand, this means sellers have the upper hand: They will likely sell their place quickly, perhaps for over asking price, with a minimum of fuss or pushback from buyers.” —Realtor.com

For example, a balanced market is generally right around six months, but can vary from region or region. So, in this example, it would take six months to sell all the active listings to deplete the inventory. Buyers can see telltale signs, as well. For instance, if homes go under contract quickly, even though prices are rising, that’s a big sign. Also, if sellers get more than one offer, that too, is a sign. Additionally, a lack of new listings (which might indicate pocket listings — or homes which don’t officially make it to the MLS but real estate professionals privately market).

How to Buy in a Sellers’ Market

Now, all of this begs the question of how to buy a home in a sellers’ market. Well, there are steps you can take. Here are some helpful suggestions for how to purchase a house in a sellers’ market:

  • Be patient. The cannot be stressed enough. Patience is always part of the house hunt, but especially so in a sellers’ market. You must exercise patience or suffer through undue stress and anxiety. Remember, there are houses everywhere. Four walls can easily be made into just about anything you need and/or want.
  • Go in with a strong offer. When you do come across a home you like in a sellers’ market, submit your strongest purchase offer. If you don’t you will probably lose the opportunity. It’s just a matter of the circumstances and you need to act accordingly.
  • Drop some contingencies. It’s not always enough to go in with a purchase offer at asking price (or even just above). It’s likely you’ll also need to drop some contingencies to make your offer stand out. Consult your buyer’s agent about a strategy.
  • Place a solid backup offer. If you come across a property that you really like but it’s under contract, don’t give up just yet. Put in a back up offer that gets the seller’s attention. This way, you’ll be the first in-mind should the deal stall or fall through.
  • Keep looking all the time. It’s not enough to wait on a purchase offer or even a back up offer or two. You should always be looking to have a backup plan of your own.

If you are considering buying or selling a home in Orlando, contact us for the latest market information. We’ll also provide you with the right advice about the local real estate market so you make the best decisions.