What is a Seller’s Market?

What is a Seller’s Market and How do Buyers Survive


The term “seller’s market” has become a popular term to throw around in discussions about the current housing market situation. That term sometimes carries the feeling of hopelessness for buyers. Understanding what a seller’s market actually is can eliminate some of the foreboding and there are some simple considerations buyers can make to ensure they have a strong investment regardless of the less than ideal market.


A real estate market is determined by inventory. In other words, how many homes there are available on the market at any given time. Real estate markets swing back and forth along a spectrum. They can be buyer’s markets, balanced markets, or seller’s markets. A balanced market is when there is 6 months worth of inventory available. A buyer’s market is when there is more than 6 months and a seller’s market is when there is less than 6 months.


Let’s talk twinkies. Many remember the great Twinkie scare of 2012. Before they were discontinued, Twinkies were a cheap and common snack. You could pick up a whole box of Twinkies for a couple of dollars. The Twinkies were experiencing a buyer’s market. However, when hostess filed for bankruptcy, Twinkie inventory changed dramatically. Because there were not Twinkies coming into the market, their price went up and they became harder to find. Twinkies then entered a seller’s market.


The same phenomenon happens with houses. On the bright side, the flow of houses coming on the market will never stop. There will always be an inventory even if it is small. However, as more people embrace the joys of home ownership, homes become more scarce and prices go up. Right now, some real estate markets are in a seller’s market. I put emphasis on the some because it is important to realize that not all markets are currently a seller’s market.


Seller’s market or not, it is important for buyers to have the best information. Here are some great tips regardless but, these tips will be particularly helpful for buyers in a seller’s market.


  • Have a buyer’s consult with a great real estate agent: A great agent could be the difference between getting the house and missing out on opportunities. It’s important for buyers to hire a fantastic agent and then meet with them so that everyone is on the same page.
  • Have your money ducks in a row: Meet with a great lender and get pre-approved for a loan.
  • See under contract homes: There may not be an opportunity for buyer’s to “shop around” in a seller’s market. Walking through under contract homes can help buyers decide what they want in a home before they may have to make a quick decision.
  • Saving up strong earnest money: While buyers save for a strong down payment, they should also put a little extra away for strong earnest money. Earnest money is a simple way to make an offer more attractive with no added cost to the buyer.


Buying in a seller’s market can feel daunting. It’s not hopeless though. All it takes is for a buyer to be well prepared and have a great team behind them pushing for their success. You can achieve home ownership in a seller’s market.


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