Hot, Normal, and Cold Markets

Hot Market

 

This is an extremely competitive market and is advantageous to the  seller. Sometimes, homes will sell as soon as they are listed or even  before homes are listed. Typically, during a hot market, multiple offers will be made on each home and more often than not, homes will sell for  more than the asking price. It is even more crucial to be prepared and  to be ready as a buyer when the market is hot. It can be easy to get  caught up in the bid for a home, but if you are prepared (pre-approved,  solid in price range, realistic about your needs), it is easier to  remain focused on your housing needs and price range.

 

Normal Market

 

In a normal market, there is a fairly large number of homes available and an average number of buyers. This market does not necessarily favor the buyer or the seller. A seller may not have as many offers on their  home, but he or she may not be desperate to sell either. Again, it is  the buyer’s responsibility to be prepared. During a normal market, the  chances to negotiate are higher than in a hot market. As a buyer, you  can expect to make offers at lower than the asking price and negotiate a price at least somewhat less than what the sellers are asking.

 

Cold Market

 

In a cold market, houses may be listed for more than a year and the  prices of houses listed may drop considerably. This market is  advantageous to the buyer. As a buyer, you have the time to make an  offer that works to your best interest. It is not uncommon to low-ball  and to find that sellers are accommodating to meet your needs. Keep in  mind that even though this market is a great time for buyers, you do not want to lose your dream home by being unrealistic. Your goal is to get  your dream home at the best possible price.