Monday, October 11, 2010

Are We Still In a Buyers Market

Many people would post a question mark on their forehead if asked:

           Is it still a buyer's market???    

For they feel in a bubble surrounded by news media talking about
foreclosures now on hold due to possible "robo signing" discrepancies at numerous banks.  

  And they just don't know who to ask.

Reality:   As long as the number of homes exceeds 6 months inventory(i.e. more homes for sale than will go under contract in six months at the current rate of sales per day), it is categorized as a
buyer's market.

Thus, if you are looking at homes in the $400,000 to $500,000 in your area of the country and you are told the inventory exceeds 11 months, you are solidly in a buyer's market.  While if you are seeking a home under $200,000 and you are told the inventory is 6.8 months, you are marginally in a buyer's market.

What does this mean to you??? 

                                 Great Question!!!!

Though the precise home you are contracting on does impact this question, typically the seller's motivation to negotiate and to provide assistance to the buyer(i.e. home warranties, closing costs, lease/purchase options) increases as the market inventory increases.
A home in a very desireable neighborhood price $100,000 less than comparable homes but still in the $400K to $500K price range in a market like that noted above could very well go counter to this conventional wisdom. 

And the last variable to consider are the reasonableness of the seller...AND the buyer's level of reasonableness.

Home contracts has an aspect called "meeting of the minds".  That is, the buyer and seller must meet together on terms that are mutually acceptable.  Failure to reach this point due to one party or the other being unreasonable in the offer or the response will cause any contract to be a no deal.

Want to know more about your market???   Contact a Realtor!!!

Got a question for me???  Let me know!!! 
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