What is a sellers' market?

It's all about inventory. A sellers' market essentially means that all the favor goes to the sellers. They get the prices they want and the terms they want, because they know these buyers only have so much to choose from. Buyers are at a disadvantage because they're at the mercy of sellers requests.

It's a lot like the great toilet paper shortage of 2020 if you can remember how that went...

In sellers’ markets, increasing demand for homes drives up prices and causes competition via bidding wars or "multiple offer situations". Here are some of the drivers of demand that you may have already noticed in the current markets around Texas:

• Economic factors – the local labor market is hot as more jobs are created, small business re-open and new residents are arriving. This is driving up home prices faster than inventory can be built or put up for sale.

• Interest rates decreasing – improves home affordability, creates more buyer interest, particularly for first time home buyers who can afford bigger homes because the cost of money and monthly payments are lower.

• A short-term spike in interest rates - may compel “on the fence” buyers to make a purchase if they believe the upward trend will continue. Buyers want to make a move before their purchasing power (the amount they can borrow) gets eroded.

• Low inventory - fewer homes on the market because of a lack of new construction or low incentive for owners to sell and purchase elsewhere. Prices for existing homes may go up because there are fewer units available.

I can see every single one of these factors affecting our markets here in the state of Texas, typically you see one or two factors at a time, but to see all of these issues combined at the same time is creating the frenzy of buyers. I've seen 30+ offers on the same house in less than 72 hours. I've seen houses sell for more than $100,000 over asking price in cash. I've seen buyers skip the option period, decline an inspection and even waive the appraisal issues and agree to pay any difference in cash if the home does not meet the offer price. Buyers are paying for closing costs, agents are taking discounts on commissions, the "rules" have been thrown out the window and it's a survival of the fittest, dog eats dog market. I've never seen anything like it!

Thinking about selling??

Now's a great time to pull the equity out of your home! If you're in the burbs and want to get a little further out, you'd be surprised at whats available and I'd be more than happy to help you get that equity and then find your next address.

Drop me a line on the contact page or in the chat box, and we'll get this party started!

#sellersmarket #texasrealestate