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Buyers' versus Sellers' Market

 Traits of a sellers' market include:  

An excellent local economy. Existing businesses are growing and hiring many new employees and many new companies are opening up.

While so many jobs are becoming available, there are not enough homes to house all of the new employees. The lack of availability of housing creates financial pressure to sell.

Home sales prices rise rapidly. In some economies, prices may nearly double in the span of a few years.

No contingency clauses are common place on buyers' contracts. Buyers are ready and willing to purchase a house under many circumstances. Substantially fewer negotiations will take place.

Down payments become much higher. In a sellers' market, buyers may bring as much as a 25% down payment to get the ball rolling. Buyers benefit from high appreciation and come prepared with large down payments.

Qualifying for the purchase price no longer requires an appraisal. Down payments are often nearly $100,000, so the risk factor is quite limited.