Is it a Buyer’s or a Seller’s market? What’s the difference between the two? Well let’s look at the difference between them. Today I’m going to talk about a Seller’s Market.
By definition a seller’s market is one where the seller typically is able to dictate the price of something because stock is limited. You have seen this before, especially in our current circumstance. My wife tried to buy a bottle of rubbing alcohol at the beginning of the pandemic, because we needed it, and CVS charged her $8 for the bottle. Yes, you heard that correctly, $8.
She was floored, and the guy behind the counter said, “they’re flying off the shelves right now, we’re only selling one per person”. Well they were also price gouging, because on the bottom of the bottle it had a sticker pricing that bottle at $4. We’re in a seller’s market in regard to personal protective equipment, toilet paper, hand sanitizer and even bottled water right now.
And this is exactly why it is important to know whether you’re in a buyer’s or seller’s market when buying or selling a home. In terms of real estate, in Nashville at least, we’ve had a pretty low inventory so far this year. But that has started to come back up. We had a 20-21% increase in inventory over last year, just last month. But limited inventory does affect how much you might spend on a house from one time of year to another, because it does create a Seller’s market.
Now, it is important to note that just because there are more buyers than there is stock in a given area, doesn’t mean that it’s a bad time to purchase. We all have different reasons to buy, and right now there’s a huge incentive in the money markets – interest rates are at an all-time low. So, what this tells us is that we are going to need to be more competitive and hyper focused on location and the type of home we want to buy.
If selling, you want to know the area you live in, and how competitive it is around you, so you know how to set your expectations for the price and timeframe for your home sale. As a buyer, you will want to focus on areas that match your ability to be competitive. Not sure how to gauge these needs? That’s where your REALTOR comes in.
As always let me know if you have any questions. I’ll be here all week.