Are you looking forward to buying a home in California? Your anticipation is well-merited, as there is much to get excited about.
Great weather, plenty of opportunities for growth, and a beautiful property on top of it all – what more could you ask for?
Although you’re eager to start this new chapter of your life, you will want to consider the best time to buy.
For the sake of your finances, and to make the entire buying process easier, you should keep your eye on the market conditions to get in at the right time.
This would ideally be in what’s known as a buyer’s market, and it’s the ideal economic situation for you to be in if you are looking to buy a home.
Below, we’ll discuss what exactly makes up a buyer’s market, how you can tell whether your market is currently a buyer’s market, and what next steps to take if it is.
What is a Buyer’s Market?
Specifically, a buyer’s market is a real estate term that defines the market as saturated with homes for sale. In fact, there are more attractive homes for sale than there are buyers to buy those homes.
In this type of market, you as the buyer, have much more power to negotiate and find a home that meets your terms and expectations.
If the seller refuses to meet your terms, you can easily move on to another home since there are so many on the market available to you.
Although this is purely a real estate term, this can be translated across the entire economy, with pretty much any industry you can think of.
This rule of our economy is simple: When the market has more sellers than buyers, the buyers have more options and control. Buyers set the prices and make the terms, and sellers must adhere to them if they wish to see a sale.
Knowing Market Cycles
It can be hard to read or predict the cycles that the real estate market goes through. That’s why it is always a good idea to get in touch with a professional real estate agent who can help you analyze and identify the different cycles the real estate market goes through.
If your current market is not a buyer’s market, you may choose to wait until it is. That way, you’ll have a lot more room to negotiate and a lot more wiggle room in your wallet, as sellers become so desperate to sell that they will agree on a lower price without much of a hassle.
Keep in mind, however, that if you wait too long, home prices may still be rising and you may end up waiting years before you decide to make your next purchase.
A few things you should know about the real estate market:
- Despite the fact that we have had some economic recessions in the past decade or so, median home values are increasing. So, the longer you hold onto your property, the more valuable it’s likely to become once you put it on the market.
- You need to look at your specific local market, not the average “U.S. housing market” as many people on TV like to talk about. It doesn’t matter what the national average is, but it DOES matter what your local market is.
- Be careful when depending too heavily on borrowing, as this can lead to more financial instability over time.
As long as you are smart and prepared, you’ll have no problem buying a home in California at a fair price and terms.
What Makes a Buyer’s Market?
The biggest factors that determine whether the market is a buyer’s market or a seller’s market is population boosting, job growth, and overall affordability.
If a new company is moving into your town and creating an influx of jobs, this is more than likely going to dramatically affect your local housing market.
This kind of market trend should be caught as early as possible because the earlier you recognize it, the easier it will be for you to take full advantage of it before others catch on.
As soon as it becomes widely known that it is a buyer’s market, the housing market may become too saturated with buyers and you will find yourself competing with them to get the house and price that you want.
As long as there are more homes for sale than buyers who want the homes, it is a buyer’s market. And, if you’re a buyer, this will work to your advantage. You have the power, therefore you get to control price negotiations and terms.
Is 2020 a Buyer’s or a Seller’s Market?
A buyer’s market defines the housing market as more supply than demand, giving buyers all the power. A seller’s market, on the other hand, is just the opposite. If there are more buyers than sellers, then the power shifts to the sellers as they can hold off on selling until they get the price that they want.
So, what does this mean for the future? Will the rest of 2020 be a buyer’s market on average across the nation?
So far, real estate experts don’t predict that the housing market situation will change much from the previous year or two.
But you can count on homes to continue rising in value, making them more equitable the longer you hold onto them.
When it comes to buying, just make sure you are shopping in a local market that is affordable and able to meet your terms.
Buy a Home in California Today
Ready to buy your dream home and start this exciting new chapter of your life? Get in touch with a professional today!
A real estate agent experienced in your local area can help you determine when the right time to buy will be so you can take full advantage of the opportunities in front of you.
If you have any more questions or concerns about buyer’s markets, or the home buying process in general, you can reach out at any time and schedule an in-person meeting.
Related: Tips For First Time Home Buyers
📞 Have Questions? Ask The Chris Eckert Real Estate Team
Give The Chris Eckert Real Estate Team a call today at 650.627.3799 to learn more about local areas, discuss selling a house, or tour available homes for sale.