Buyer’s Market vs Seller’s Market

Are we in a Buyer’s Market or a Seller’s Market?

Understanding whether we are in a buyer’s market vs seller’s market or balanced market is important: it affects pricing strategy, anticipated time on the market for listed homes, negotiation tactics, and more. We’ve put together a guide to help you understand these important terms, what shifts in the market mean for you, and how to get the most out of your real estate transaction.

How do we figure out what kind of real estate market conditions exist?

The sales to active listings ratio is widely used by industry insiders to quantify the strength of the market. It represents the percentage of the available inventory that is sold each month. Generally speaking, a ratio of below 0.12 indicates a slow market (“a buyer’s market”), while a ratio of over 0.20 indicates a hot market (“a seller’s market”), with many more buyers than sellers and intense competition for properties. A ratio between 0.12 and 0.20 reflects a “balanced” market, where the number of sellers and the number of buyers are roughly balanced.

The market conditions vary based on the area of the Lower Mainland or Fraser Valley in which you live, and the type of housing (detached, condominiums or townhouses). We’ve assembled the most comprehensive set of statistics available for each region on our website, and we invite you to check for yourself the conditions for your area and housing type:  Market Statistics by City.

Generally speaking, as of December 2022, most markets in the city are actually balanced. Some of the most expensive markets (detached homes in West Vancouver or Vancouver West) have swung to buyers’ markets, while the most affordable condos are actually still sellers’ markets!

Would you like to have a neighbourhood-specific conversation about whether you are in a buyer’s market or a seller’s market, and the differences it will make if you sell? Call us – we’d be glad to share our insights! (This article would be miles long if we discussed each market individually!)

How do I Buy or Sell when the market isn’t in my favour?

Selling in a buyer’s market (or a balanced market)

We have observed that in a buyer’s market, a very large percentage of the buyers are bargain hunters and a small minority are looking for their dream home – not necessarily the lowest price. The latter group are the ones you want to attract to your home to attain the best price. Attracting the dream home buyer requires an agent who is formally schooled in marketing, who understands how to segment customers to identify the profile of the most likely buyer and what they value. And then staging the home perfectly to appeal to that customer. We are very proud of our success selling for terrific prices in difficult conditions – contact us, we’ll be glad to show you what we’ve done for others and, most importantly, what we can do for you!

Additionally, sellers need to be flexible and patient. Accommodating short notice for showings and ensuring your home is ready to view at all times can maximize the chance of a sale. Pricing your home correctly, based on the local market and recent comparable sales can also give sellers a leg up.

Buying in a seller’s market (or a balanced market)

When buying in a seller’s market, be prepared: know your budget by obtaining pre-approved for a mortgage before you start browsing listings. Sellers are attracted by strong offers with a sizable deposit is attractive to sellers, as well as flexibility on the closing date. So, get as much information from the listing agent as possible before writing up the offer. And we have many innovative approaches to differentiate your offer from the others which we have developed over the years – contact us for details!

Check our other blogs under Market Trends – that might give you answers about buying or selling a home.

The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only.