Tuesday, November 19, 2019 / by Pamela Glende
A seller’s market is a market condition characterized by a shortage of homes available for sale. This results in pricing power for the seller. A seller’s market is a term commonly applied to the real estate property market when low supply meets high demand.
A balanced market is 5.5 months of inventory. What this means is that in 5.5 months if no new homes came on the market, we would run out of homes in 5.5 months.
In the current Spokane Market, we have been staying just above a 1 month inventory. Since that is well below a balanced market of 5.5 months we are in a seller’s market. If we were above a 5.5 month inventory then we would be in a buyer’s market.
A seller’s market is advantageous to sellers in that they can price their homes a bit higher than market value or at market value and most times they are getting more than listed price. This happens because there are so many homebuyers shopping for homes and not enough homes to choose from. This results in bidding wars and multiple offers which drive up the price of the home.
Cities with a lot of available jobs and that have growing industries will often be in a seller’s market, while those with struggling economies will be in a buyer’s market. The market tends to correct itself historically. We here in Spokane have been in a seller’s market for several years, we are past due for a market correction. That being said, I think we are safe for a while since we have so many new industries coming to Spokane bringing jobs and also people that will be looking for housing.
Let’s face it most people desire to be homeowners. Often times rent is as much if not more than a house payment. People that rent often feel like they are throwing away money.
Even in a seller’s market purchasing a home is a good idea if you plan to be in the home for at least 6 or more years. I'm Pam with Haven Real Estate Group. Let me know if I can be of service for your real estate needs.
I'm Pam with Haven Real Estate Group. Let me know if I can be of service for your real estate needs.