How Real Estate Market Trends Affect You

Many external factors come into play when buying, selling or renting a property.

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Consumers need to be aware of these major real estate market trends to plan how conditions will affect them.

There are two main ways to describe the state of the real estate market, namely whether it is a seller’s market or a buyer’s market.

Adrian Goslett, Regional Director and CEO of RE/MAX Southern Africa, said these terms can have various implications for anyone involved in real estate transactions.

To elaborate on these implications, RE/MAX of Southern Africa explains how these two market trends will affect buyers, sellers, owners and renters:

Buyer/Tenant Market
The market swings in favor of buyers or renters when similar homes are plentiful for sale or rent in an area.

This excess supply will lead to lower demand and prices are likely to be driven lower.

Under these conditions, a seller might want to keep the current property until market conditions change.

For landlords, these conditions make it difficult to charge more rent, as there are many other rentals available if the current rental amount is not attractive.

Sellers/Owners Market
In a seller’s or owner’s market, there are fewer homes for sale and for rent.

This drives up demand, which also drives up asking prices.

Buyers will need to act quickly and make competitive offers when looking to buy in these types of markets.

Likewise, tenants will need to act quickly and file their applications first to ensure that theirs is the one accepted by the landlord.

Timing the market
Choosing the right time to sell in a seller’s market and buy in a buyer’s market is difficult.

Goslett told homeowners that when selling a home to buy a new home, the advantage of one market will be offset by the other.

“For example, sellers might be able to sell at a higher price in a seller’s market, but they will likely also buy at a higher price.

“Similarly, in a buyer’s market, homeowners might sell a little cheaper, but they’ll also be likely to buy a house for a better price.”

It’s important to remember that each suburb will also have its own micro-trends that may mirror or be completely opposite to larger market trends.

While it’s fairly easy to find out what kind of market conditions the country is experiencing as a whole, local suburban trends are best discovered through a conversation with a local suburban expert.

“With access to real-time data on the average time on market and price per square meter in the area, real estate professionals can share suburb-specific information that can help consumers assess delays and possible costs or returns.

“This information can help buyers, sellers, landlords and renters make better decisions about their real estate transactions,” Goslett said.

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