The Edmonton housing market (like all real estate markets) goes through cycles and is influenced by things like the local, national and international economy, interest rates and banking restrictions, which can create an increase or decrease of the value of properties on the market. Right now the Toronto and Vancouver housing markets are booming and this has had an effect on interest rates which not only influences those markets, but all real estate markets in Canada. A sellers’ market takes place when there are more qualified buyers who are searching for a home. On the other hand, a buyers’ market is when there are fewer qualified buyers looking to buy a home relative to the amount of people trying to sell their home. A balanced market is when we have close to an equal amount of buyers and sellers in a housing market.

Knowledge is power

Whether buying a home or selling one, knowing what market you are in, what your particular circumstances are and knowing what to do in that market is essential to the successful purchase or sale of your home. It will help you to save time, make or save you money, and help you avoid some of the many pitfalls that you may unsuspectingly fall in to otherwise. Please read on for a brief description of a Seller’s and Buyer’s market as well as some of the things you can do as a buyer or seller to your benefit.

Seller’s market at-a-glance

• More buyers than homes for sale
• Prices are higher because of increased demand
• Homes spend fewer days on market
• there is a higher chance of multiple offers on a home, giving the sellers greater negotiating power

Buyer’s market at-a-glance

• There are more sellers trying to sell their homes than there are buyers
• Days on market increase
• Housing surplus can slow rising prices and even lead to price reductions
• Buyers have more choices and more leverage to negotiate

If you’re looking to buy (or sell) a home, it’s important to know which type of market you’re in as well as what changes might be on the horizon. If you’re unsure, you can do things like asking your lending institution, keeping track of what is happening on the news and asking your real estate agent. Of course, selling a home in a seller’s market is optimal, as is buying a property in a buyer’s market, but for many they don’t necessarily have the luxury of timing their home sale or purchase to coincide with the most advantageous market. It could be quite likely, for instance, that you’d be buying in a seller’s market or selling in a buyer’s market.

Tips on selling your home in different housing markets

Selling in a seller’s market is generally quick and easy. In a buyer’s market, with an abundance of properties sitting idle, you may want to do some legwork to help sell your home. There are a number of things you can do to improve your chances for making a sale. These include:

• Understand the local market and your competition
• Price your home right (and conservatively)
• Make sure your home is ready to be shown at all times (consider using a professional home stager who can help show off the best features of every room in your house)
• Be accommodating to realtor’s/prospective buyer’s schedules (think of every showing as the one that could get you the sale)
• Be flexible with your terms (offer an extended closing date or lower your asking price)
• Be patient (and stay positive)
• If you get an offer early on, give it serious consideration because a better offer may not come along

Multiple Offers

In a seller’s market, with fewer homes available to purchase and more buyers looking, you’re more likely to get several offers on your home. Here are some things you can do to help increase your likelihood for getting multiple offers:

• Keep your home clean, clutter-free, presentable and ready to show (hire a professional stager if you can – see above)
• Consider pricing your home slightly below its fair market value
• Make sure your home has sufficient market exposure (i.e. list on the Multiple Listing Service (MLS), create print materials, such as flyers or postcards with key selling points and a professional quality photo of your home, post on social media, consider newspaper/magazine ads, list on other real estate listing web sites and your agency’s company web site)
• Be ready to show your house on demand (with no appointment necessary)

Tips on buying a home in different housing markets

With more homes for sale than buyers and potentially lower prices, a buyer’s market could be a great time to buy a new home. Before doing so, however, consider the possibility that home prices could continue to fall, meaning your new purchase might be worth less than you paid for it in no time. Of course, what goes down will eventually come back up. The time it takes for it goes back up is something that is unpredictable. That being said, if you wait for prices to drop even further, you might miss out on a great opportunity, when prices do begin to rise again.

If you’re looking to buy in a difficult seller’s market, there are things you can do to improve your likelihood of success.

• Get pre-approved for a mortgage first, so you know how much home you can afford
• Put forward a strong offer with a significant deposit amount
• Move quickly on a home if you like it (and be aggressive without being annoying)
• Make your offer as attractive and uncomplicated as possible (i.e. eliminate as many conditions as possible, such as the condition of the sale of your existing property, shorten the closing date or come up with a larger down payment)
• Be agreeable and responsive
• Be flexible with your move-in date
• Appeal to the seller with a personal letter

These are just a few examples of what you can do to increase your odds of a successful purchase or sale of a home. Remember to arm yourself with knowledge and if you have questions, you can ask your lender or Realtor as well as going on line. The time you spend getting educated could make or save you tens of thousands of dollars.