Is it a good time to Buy, Sell or Invest?
Is it a good time to Buy, Sell or Invest?
Some real estate professionals may tell you, “it’s always a good time to buy, sell or invest”. Is that a true statement? That depends on a number of factors; are we in a “seller’s” market, “buyer’s” market or a “neutral” or “balanced” market? Which one these real estate markets exists at present and who decides what type of real estate market currently exists? That depends on who you ask. Some of the factors
l Does supply exceed demand or does demand exceed supply? Current inventory level is one of the easiest ways to determine supply. The more difficult question is how demand is measured or quantifiable? We can look at the number of most recent sales and pending transactions, but that is not necessarily an accurate measure standing alone.
l What is the average days on market over a specified period of time, for example, on a quarterly basis or year over year?
l Where are prices trending, up or down? Are there price reductions in the market? How many price reductions were a result of over-pricing? How do those homes with price reductions compare to pricing of the overall inventory?
l How are current inventory levels changing over the past month, quarter and year over year? At which price points and in which local communities?
l One definition of a “real estate market” is to a) divide the number of homes currently on the market by b) the number of homes that have sold within the past month; If the result is 7+, it is a buyer’s market and if the result is below 5, it is a seller’s market.
l A more challenging assessment of current real estate market conditions will depend on 1) individual towns or cities, 2) individual neighborhoods or communities within each town or city, 3) type of geography such as waterview, waterfront, mountain views, wooded areas, in-town or walk to town, etc., 4) type of home (colonial, split-level, contemporary, antique, farmhouse, etc., 5) age of home, 6) pricing and 7) days on market.
For more information, please contact me anytime at (203) 231-8098 or gbakes@wpsir.com.
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