Is This a Buyer’s, Seller’s, or Balanced Housing Market?
For the first 6 months of 2017, we saw near record-low inventory, which meant the market benefited sellers, however June numbers show inventory has increased leading to a more balanced and healthier market.
When buying or selling a home, everyone wants the most advantageous situation. Both buyers and sellers want “the best price,” but this definition varies: Homebuyers want to purchase the desired property at a good deal, while sellers want to receive their asking price. But how does the housing market determine who wins this tug of war? Is this a buyer’s housing market, a seller’s market, or a balanced market?
What are the signs of each housing market?
How is the market (buyer’s, seller’s, balanced) determined? By speculating how many months would be needed to sell every home that is on the market. It is typically determined by months of supply by taking the inventory of homes for sale at the end of a given month, divided by the average monthly pending sales from the last 12 months.
MARKET MONTHS OF SUPPLY
Buyer’s More than 7.5
Balanced 6.5 and 7.5
Sellers Less than 6.5
Each market affects buyers and sellers differently. In a buyer’s market, industry states that consumers searching for homes have a large inventory of houses to choose from, and they can take their time when making a decision. In addition, real estate agents can often negotiate a lower price.
However, in a seller’s market, these factors are reversed. When there is limited inventory buyers have fewer choices, and they can’t afford to leisurely make a decision. Also, in a seller’s market, the ability to negotiate on price is less likely.
- Single Family Home Inventory is up 10%
- Single Family Home Median Price is $616,000
- Single Family Home Median Price is down 1%
This change in the market is by no means a trend yet as it has only been a month, however this is the first sign that inventory has increased. To discuss all things real estate in Kelowna, contact the Kelowna Real Estate Pros at 250-575-1946 and to view current available properties for sale, view listings here.