Are You Planning to Buy Real Estate in the Knoxville Area in the Next Year?
Types of Marketplaces
The real estate falls into three kinds:
1. Buyer’s Market
- Exists when there are more houses put up for sale compared to the number of buyers. One sign that you’re in a buyer’s market is that the inventory has stayed in the market for more than six months. Because there are only few buyers, it generally results to fewer sales that can tilt median prices.
2. Seller’s Market
- Exists when there are more numbers of buyers than the number of available houses for sale. Almost all homes are sold in this type of market. One sign that you’re in a seller’s market is that the inventory stayed for less than six months.
3. Neutral Market
- Exists when the number of sellers and buyers are evened out. This kind of market is balanced and the scales don’t tilt in any direction.
There are a lot of differences between purchasing in a buyer’s market and in a seller’s market. The best timing to buy is when the market is cold, meaning there’s more inventory.
Here are some advantages of buying a home in a buyer’s market:
- When there are less homes selling, prices decline as sellers are more eager to negotiate because they know that they might not get another purchase offer if they refuse to take yours.
- In this market, buyers can demand concessions; they can ask for closing cost credit from sellers, given that the lender allows it. Moreover, buyers can insist that sellers pay for reports like a home warranty, roof certifications, or pest inspections.
- Contingent purchase offers are usually acceptable in a buyer’s real estate market. In general, sellers are likely to agree with contingencies asked by buyers since they consider that having an offer in hand is a lot better than having nothing at all.
- Buyers can easily negotiate with sellers regarding the repairing and updating of the home, particularly appliances and home systems. The latter often pays for the necessary fixes noted by the inspector.
- In a buyer’s market, you are in control of the deal. You can ask for longer periods for inspection, and extension of deadlines. These contract terms are often rejected automatically in a seller’s marketplace.
If you are thinking about buying a home then don’t miss out on this buyer’s market. This is your opportunity to take advantage of the real estate market.
Contact us for more details.