How to Buy a House in a Seller's Market

How To Buy a Home in a Seller’s Market

Last Updated on March 7, 2022

As we continue through 2022, a majority of the Canadian housing markets will sit in the seller’s market territory. And this is great news for those who already own a home and are in the consideration stage of selling.

However, those ready to buy their first home may start to face more challenges.

So how exactly can you buy a home in a seller’s market? Here what you need to know.

Buying a Home in a Seller’s Market

With the current forecast, most Canadian homebuyers in 2022 who plan to purchase will most likely face limited housing supply and more competition.

They’ll soon be asking how to buy in a seller’s market, when against all odds.

What is a Seller’s Market?

When there are more buyers than there are homes available, for sale, is when a seller’s market is happening.

With listings being fewer and competition increasing, homes will typically sell quickly, seeing an increase in bidding wars that result in selling over the asking price.

On the other hand, a buyer’s market means there are more homes for sale than there are buyers. With the competition being lower, buyers tend to take their time shopping the market and will have the power when it comes to negotiating.

Sometimes there is a balanced market, meaning an equal number of buyers and sellers, resulting in offers that are reasonable and average market days. Stable home prices are more prevalent due to less tension between buyers and sellers.

How do you Buy a Home in a Seller’s Market?

You want to be informed. You want to have a handle on the market conditions is a great first step to help with a successful transaction.

Regardless of market conditions, you want to keep yourself informed, especially during a seller’s market.

With real estate being local, each neighbourhood can be different so you want to reach out to a professional, experienced real estate agent to ensure you have the best resources available.

Know your Budget

How much can you exactly spend on your budget?

You want to take into consideration of your lifestyle and figure out what sacrifices you’re willing to make.

If this is something that is difficult, you may want to lower your home-buying budget to continue your lifestyle.

Start by getting pre-approved for a mortgage to give you an idea of how much a lender is willing to finance and the amount you can spend.

Act Fast

If you want to buy a home in a seller’s market, you’ll need to act fast when you find a property that you’re interested in.

If you’ve done all of the prep work, this will easily pay off in the long run, allowing you to successfully purchase your home in a seller’s market.

Make a Strong Offer

Within a seller’s market, you may only get one chance, and sometimes it isn’t always about the money.

There are a lot of moving parts when it comes to real estate and it can get complicated.

Many of the same offers come in so you want to stand out from the crowd, and this means having as few conditions as possible.

Some conditions include:

  • A conditional financing.
  • Conditional on a home inspection.
  • Conditional on the sale of a home.

Prepare to Pivot

Buying a home in a seller’s market, you want to continue to prepare yourself to pivot.

Since market conditions can easily change, you want to have a backup plan just in case the purchase needs to be delayed or if an opportunity presents itself, to jump on it.

Work Alongside an Expert

As a homebuyer, you have the option to handle the transaction on their own, or you can take the route with a professional real estate agent.

If you want to keep the stress down, working with a real estate agent is the best course of action. Here are some advantages:

  • Better access to homes
  • Negotiating skills
  • Paperwork is easily handled
  • Support and guidance through the whole process
  • Real estate knowledge

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