Home prices are up almost 20% from where they were just a few years ago. Just six months ago, buyers were sweetening their deals by writing personal letters to appeal to the seller’s heart strings or upping the ante with all cash offers over asking price, and more. That truly would signal a seller’s market. Things have slowed considerably. But has it shifted enough for us to be in a buyer’s market?
What is a buyer’s market?
Did you know there’s a way to know if it’s a good time to buy a home?
Buying a home is always a personal decision, but there are two key numbers you should pay attention to so you know how favorable the market is. These numbers tell us if it’s a seller’s or a buyer’s market.
Real estate pros pay close attention to how many homes are for sale and how quickly they are selling. This gets simplified into a number of how many months of inventory there are - meaning if no more homes were listed how long would it take to sell what’s available? For example, if there are 100 homes currently on the market, the real estate experts examine if those 100 homes sell out in 1 month, 2 months or more.
Based on this calculation, we’ve been in a seller’s market for several years and we still are.
Supply is starting to increase but until we have more than 6 months of inventory, we won’t be in a buyer’s market.
But that shouldn’t prevent you from buying. In fact, the market is slowing down so you may be more likely to get that first home on your wish list than you were earlier in the year.
Should I buy now?
No matter if it’s a buyer’s or seller’s market, you’re probably trying to figure out if it’s a good time for you to buy a home.
There are three questions you need to ask yourself.
Start with asking if you know what monthly payment works for your budget.
Next, is your income fairly stable and do you have enough money for the down payment and closing costs?
And the last key question…are you preapproved?
If you’re unclear on any of these, it’s time to call your friendly mortgage professional.
How can I take advantage of a buyer’s market
While it is getting easier for people to buy a home in today’s market, there still is some competition among buyers. If you are looking to buy, however, there are a few things to keep in mind to take advantage of the current market conditions.
When more homes are available it means more people can buy and there are three ways that benefits you:
#3 - you may get a home a for a lower price
#2 - sellers may pay for repairs needed on the house
#1 - you may be able to save thousands by having the sellers pay your closing costs.
While the market has seen its ups and downs – more ups than downs lately – there really is not a time when sellers aren’t selling and buyers aren’t buying.
So, if you are in the market, start the search by first working with a mortgage professional. Have questions about the process? Drop your questions in the comments and check out the free resources on my site.