A “seller’s market” means that there is less than the normal level of inventory available for sale. In most of the US, the market turns to Seller’s Market condition when there is less than 6 months of inventory, in Northern Virginia, you can expect much less, closer to 2-3 months of inventory. Inventory means that the homes that are on the market at this moment will last X number of months. In a seller’s market, buyers struggle to find the correct “market value”, without overpaying. What most buyers don’t understand is that it is the buyers that determine market value. The market is directly influenced by how much a buyer pays for a home, and how many homes have sold at similar prices in the surrounding areas.
If a buyer wants a home and has the money to pay for it, then regardless of the neighborhood sales and the appraisal value, that becomes the new market value. If the appraisal comes in at $135,000 and the buyer offers $160,000, but appraisal comes in at $140,000 and the buyer fronts the balance in cash, the new market value of the home is $160,000. This drives up property values in the neighborhood as well.
In a sellers’ market, homes often sell with multiple offers within the first few hours. The multiple offer situation drives up the price like an auction. Even if the neighborhood hasn’t sold anything in that range, so long as a buyer has the ability and willingness to pay the higher price, they can bring that value up.
In a seller’s market, it doesn’t matter where you price your home, so long as it is home buyers want, the value can easily be driven up. The market can be summed up as the monetary value a buyer is willing to pay to buy your property, regardless of other circumstances.
For further questions, or to schedule a consultation, please contact Abraham Walker, your Northern Virginia Real Estate Specialist at Abraham@AskAWalker(dot)com.
About the Author: The above article was written by Abraham Walker, Your Northern Virginia Real Estate Agent, helping clients market their homes to achieve high sales with a quick closing time is my main priority.
He’s the co-founder of Ask A Walker and can be found on YouTube, Facebook, and HERE on this blog.
Abraham can be reached via email at [email protected] or by phone at (703)539-2053.
He’s happy to answer all your real estate questions.
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I help people sell and buy real estate in the following Northern Virginia area cities & neighborhoods: Kingstowne, Island Creek, Cameron Station, Overlook, Alexandria, Old Town, Belle Haven, Fort Hunt, Mount Vernon, Springfield, West Springfield, Burke, Lorton, Woodbridge, Lake Ridge, Manassas, Annandale, Fairfax, Arlington, McLean, Reston, Herndon and of course Vienna.