What is a Seller’s Market?
If you have been even lightly following the real estate market lately, we are sure you have heard that it is a seller’s market. And while you may know that means there is limited inventory, there is actually a lot more to a true seller’s market than meets the eye. So, that begs the question. What is a Seller’s market anyway?
Traditionally, an even market, meaning not a buyer’s market and not a seller’s market would represent about 6 months of inventory. With an even market, if no new inventory comes on the market, there would be properties to sell for 6 months before everything is gone. Therefore, with more than 6 months inventory, we enter into a buyer’s marketing and less than 6 months inventory, we enter into a seller’s market.
A seller’s market becomes a game of musical chairs. There are not enough chairs for all the players so when the music stops, everyone has to scramble to find a chair. A market with 5 months of inventory may have 4 chairs and 5 players, but a market with 2 months of inventory may have the same 5 players with only 1 chair. In this situation, the chairs are properties for sale while the players are buyers.
As a buyer, a seller’s market can be frustrating and confusing. You can be wondering if you are buying at over inflated prices, or you could get discouraged because you are competing with so many others when you find that perfect property. However, it can still be done. You can still find that perfect property and put in a competitive offer that has a great chance of being accepted. It is vital, however, to work with an agent that knows the market well. In the current market, we are making every effort to see EVERY property that comes on the market. That way we can compare to recent sales and provide you with the best possible guidance in placing a competitive offer.
As a seller, it can be enticing to try to sell you home on your own, because after all, buyers will just knock your door down to see your property since there isn’t much to see. However, it is still more crucial than ever to work with a reputable agent on pricing strategy and marketing. Yes, we are seeing multiple properties get multiple offers. But that is only the case when properties are priced well. If you over-price your property you could miss out on a huge number of buyers, but you price competitively, you could put yourself in a position to drive up the price with multiple offers. Furthermore, it can be appealing to just snap a photo or two on your phone and expect people to still want to come see your property. Proper photography and gathering all property details will be vital to getting multiple strong offers. If buyers have questions that can’t be answered immediately, offers will include a variety of contingencies that can be hard to compare between offers. Also, you may want to consider getting your property pre-inspected to eliminate that from any buyers’ minds!
Right now, in Ketchum, there are 1.31 months of inventory in the residential market. Sun Valley has 0.73 months of inventory. As we roll into spring, we will start to see a trickle of inventory, but the backlog of buyers only grows. If you are looking to buy or sell this spring or summer, give us a call now. We can start putting together a plan to make you a competitive buyer or seller in this interesting market.