When looking to buy or sell a house, understanding the market at the time is essential. Whether your area is experiencing a seller’s or buyer’s market will determine how effective your efforts to buy or sell will be. As the names suggest, each respective market benefits its namesake, where buyers will have more options when it comes to house availability and room for negotiation in a buyer’s market and, conversely, sellers will have a higher chance of selling their properties at their desired prices during a seller’s market.

A seller’s market occurs as the result of a disparity between supply and demand when there is high demand for properties but a low number of available homes. Currently, it seems that, despite the potential for sellers to list and sell their properties at higher, more desirable prices, not enough sellers are driving up their prices.

For those who do not have experience navigating the intricacies of a seller’s market, being able to determine when to buy or sell, as well as when to raise prices or be open to negotiation, is important.

Approaching a Seller’s Market as a Buyer

For the most part, buyers in a seller’s market are somewhat at a disadvantage. With more buyers looking to make a purchase than there are homes, the market becomes incredibly competitive. Bidding wars and rapidly rising prices are common during a seller’s market, and this has been seen recently in Toronto, especially in desirable neighborhoods. Their desirability has increased thanks to the media, which has promoted certain regions as being trendier, resulting in an uptick of the market in terms of prospective buyers and rising prices.

Approaching a Seller’s Market as a Seller

During a seller’s market, individuals who are looking to list their homes for sale in the near future should strongly consider moving up their timeline.

In the current climate of the real estate industry, some prospective sellers may feel inclined to wait until spring to list their properties because of the promise of warmer weather, more attendance at open houses, and an influx of potential buyers, but doing so could actually be detrimental. Rather than wait, sellers may have more success listing in a seller’s market due to the existing low supply of house listings; the spring could bring in a major influx of properties, shifting the tides to favor the buyer, and while the season may seem like a better time to list a property, the market situation is often a better way to gauge the potential success of your listing.