A seller's market is what happens when there are not that many homes for sale on the real estate market, but there are plenty of buyers. This can vary from area to area, and it will make things difficult for buyers that are looking to buy a home. While buying a home is not impossible, it will involve knowing the following things about buying in a seller's market.
Homes Will Come And Go Quickly
Be aware that having a low inventory of homes could result in homes going on and off the market very quickly. Buyers will be keeping an eye on the listings each day to see homes that show up as new listings, and then immediately want to tour the home if they like it so they can make an offer.
This means that if you are only doing your research for homes on the weekends, you could be missing out on homes that have come and gone during the week. You need to be prepared to look at listings daily and willing to act quickly to schedule a showing. You'll also want all your finances lined up, such as your mortgage pre-approval, so that you can have a good offer letter.
Offers Will Be Competitive
When it is a seller's market, it is very easy to make a low offer for a home and see what the seller says. The worst-case scenario is that you make a bad offer and have an opportunity to revise it. This is not the case with a seller's market. Buyers will be told to make their best offer, especially if they have multiple interested sellers. Make an offer that is too low and you could end up losing your chance to buy the home.
Thankfully, you do have some tools you can use to win a home if you really love it. Your agent can suggest using an escalation clause, which simply states that you are willing to beat the best offer by a specific amount of money. You run the risk of overpaying for the home, but it can also give you peace of mind that you didn't pay more than you would by guessing at what the top offer would be.
Think you're ready to buy a single-family home during a seller's real estate market? Reach out to a single-family home real estate agent for assistance, since they can help you find a home at a time when it can be tough.