Author: If you find yourself looking to buy in a seller’s market, it’s important to be strategic in your purchasing approach.
It’s understandable that you may be daunted by a market that sits in the seller’s favour, but if you’re organised, thorough and proactive, you could actually give yourself an advantage in a tight market.
What is a seller’s market?
A seller’s market refers to when there is more demand from buyers than housing supply, while a buyer’s market means there is more supply than demand.
Though often regarded as a negative for buyers, a seller’s market can actually work to the advantage of strategic buyers who are organised and ready to secure a quick deal.
When property listings are low, turnover is usually high, which will often inspire other potential sellers who have held back from listing their property to act.
A seller’s market can also be an advantage for buyers who must sell their existing property before securing the purchase. As a general rule, sellers regard this situation as less than ideal and would rather not have to wait for another home to sell before selling theirs.
However, in a fast market, seller’s have more flexibility to consider these offers, even alongside other offers that may come through without conditions attached.
How do you approach buying in a seller’s market?
When it comes to buying in a seller’s market, there are a number of key factors that will contribute to your success.
Tips for buying in a seller’s market:
◦Be prepared. Organise your finances prior to looking so that you know exactly what you want to buy.
◦ Timing is critical in a seller’s market. Once you have determined your budget, type of property and preferred location you should work to a clear plan.
◦Confine home open inspections to properties that meet your specific requirements and don’t waste time perusing homes you know realistically you’d never want or be able to purchase.
◦Talk to agents about properties that may not have come onto the market yet.
◦Consider hiring a buyer’s agent to help with your search, especially if you don’t have a lot of time for home-hunting or lack confidence in a competitive market.
When you do find the right property, make sure the seller is aware you are a committed buyer. A low offer is less likely to be considered, so be prepared to make a reasonable offer with a little ‘wiggle room’.
The sum of your deposit can also be an important contributing factor when buying in a seller’s market. A large deposit conveys to the seller you are genuine and have confidence in securing finance, which is an attractive prospect to seller’s looking for a swift, uncomplicated sale.