In real estate there are generally three different kinds of markets: a buyer’s market, a seller’s market and a balanced market. Knowing the current market state is important as it affects pricing, supply and demand and negotiation opportunities. The various markets defined below:
Buyer’s Market – when there are more homes (supply) than buyers
Seller’s Market – when there are more buyers than homes available
Balanced Market – when there is an equal number of buyers and sellers
Another way to look at this if by ‘months of available inventory’. If we were to take a snapshot of the available inventory at a specific time and NOT add any more listings, how many months would it take us to deplete the stock. Generally speaking:
5-7 Months of inventory is considered Balanced
Over 7 months is considered to be a Buyer’s Market
Under 5-6 months is considered to be a Seller’s Market
Where is the market now?
For the past few years, the Toronto real estate market has definitely been a seller’s market. With our low supply in the housing sector, low interest rates and higher population in the city, there has been an increase of buyers in the market.
How does the market affect you as a buyer?
Successful buyers have a plan. They are organized, responsive and understand that buying a home is a process of elimination. This is where I come in. I like to meet with buyers to discuss neighbourhoods, price points and key needs and form a buying strategy. With all the increased competition, buyers that have a plan and are realistic are generally the ones winning in todays’ market. I will also adapt our negotiation strategies based on what is happening exactly at the time, there are many small nuances to winning in today’s market.
Markets can vary in each neighborhood, contact me here and I can discuss the specifics of your preferred neighborhood.