Buyer’s Market vs. Seller’s Market: What’s the Difference?

Marketing Team • April 14, 2022

Buying or selling a home is a big process on both sides of the equation. Regardless of which side you’re on, you’ll be upending your family and starting fresh somewhere else. 


If you’re looking to make this process as pain-free as possible, it’s important to understand the different types of markets that exist.

canadian house

Both potential buyers and sellers need to know the current housing market conditions so they can plan correctly. Property buyers about to explore a seller’s market will approach the entire process differently than if it was a buyer’s market. And the same is true for sellers when dealing with a buyer’s market too. Market conditions should inform every decision you make.


In Canada, house transactions continue to rise,
reaching 668,026 home sales in 2021. Coupled with the fact that the total investment in building new properties has increased to $18.4 billion, it’s clear that Canada’s real estate market is booming and appears to show no signs of slowing down. 


So, what can home buyers and sellers do to achieve the best real estate outcome possible? It starts with understanding the key differences between these two market types.

What is a Seller's Market and a Buyer's Market?

Both of these important market conditions relate to how many homes are on the market and are heavily influenced by basic supply and demand. 

  • What is a seller’s market? A seller’s market occurs when there are more buyers than houses available on the market. These conditions tend to lead to a competitive market with higher home prices and give sellers more control over the real estate process.
  • What is a buyer’s market? A buyer’s market occurs when there are more houses available than buyers. Buyers now have the advantage and more negotiating power as sellers will be eager to close the sale. This is typically recognized as a more balanced real estate market.
  • When should I buy a house? In a perfect world, a buyer should purchase a home during a buyer’s market when housing prices tend to be more affordable. However, that’s not always how real estate works. Market conditions can persist for many years, especially in markets with a low inventory of homes for sale.
  • What about selling a house? It’s the same idea, selling in a seller’s market is ideal, but not always possible. That’s why it’s important to work with a local real estate agent that understands your market, pricing strategies, and can help you stage, list, and sell your home for the best price possible. 


That’s why both buyers and sellers need to learn how to operate in both market conditions. Next, let’s explore actionable tips to help you succeed in your next real estate transaction.


Strategies for Buyers in a Seller’s Market

What if you need to buy a home in a seller’s market, what do you do next? Don’t lose hope, you can still secure a great home. Here are some  real estate tips for buyers to get you started on purchasing your next home.


Find Out What You Can Afford

Buying a house should always start by figuring out what you can afford, regardless of market conditions. Take everything about your financial situation into account:

  • Review your current budget and make sure it’s accurate
  • Meet with a financial advisor to look over everything and help you determine your down payment
  • Pull your credit report and go over it meticulously. Fix any problems before proceeding
  • Gather necessary documents: proof of income, address history, bank statements, and information about current debts


Now you’re ready for the next crucial step in a buyer’s market - pre approval. 


Get Preapproved to Buy a Home

Unless you’re making a cash offer, get preapproved before you start viewing homes. A seller’s market moves quickly and preapproval helps you keep up with the pace. A pre-approval will further legitimize your offer since sellers won’t need to worry about financing conditions. All things being equal, when a seller receives an offer without conditions, it is much more positively received offer.


Contact your current bank to begin the process, your existing relationship with the bank can often be helpful. 


Work with an Experienced Real Estate Agent

When house prices are at an all-time high, a seller’s market may not be the best time to buy a house, but working with a great real estate agent will still make it a positive experience. They’ll know how to help you stand out among the crowd and know how to move quickly to land you your next home. 


Don’t get discouraged if your first offer or two aren’t accepted. Keep trying and stay flexible, you might need to consider homes without certain features.


How to Buy in a Buyer’s Market

Buying in a buyer’s market is the dream and you can get an even better deal by following a few tips:


Work with a reputable agent who can advocate for you.. For example, a professional real estate agent can provide advice on things like neighbourhood information, home comparables in the area,  and other essentials to help you make an informed offer.

Strategies for Sellers in a Buyer’s Market

The best time to sell a house is when there is competition between buyers, but you may need or want to sell your home in a buyer’s market. Follow these tips so you can still attract a purchase-ready buyer.


Be Competitive with Your Pricing

Work with a real estate agent to determine a competitive price that works for you. Your list price should be based on market data and your home’s appraisal. If you’re bold, you can even go lower than what would be acceptable in an attempt to attract multiple buyers and create a bidding war. Bidding wars can still happen in buyer’s markets, they’re just less common.


Make Your House More Appealing

Stage your home to appeal to a larger variety of potential buyers, and have professional photos taken.. A common roadblock buyers face is not being able to see themselves in your home. It might be due to not liking your decor, or the house just looks too lived in. Check our post on home staging and find out why it is worth the investment.


Curb appeal can never be overstated. Grab buyers’ attention by having a pristinely manicured landscape. It may even be worth a new coat of exterior paint or upgrading outdoor fixtures.


Know What You’re Willing to Concede On

Be ready to not get everything you want. Determine what concessions you're willing to make to sell your home ahead of time, such as:

  • How low are you willing to drop the price?
  • Is the closing date firm or flexible?
  • Will you be willing to pay for repairs?


Don’t be blindsided – have an immediate answer when the buyer asks to drop the price or to move the closing date.


Strategies for Sellers in a Seller’s Market

Congratulations, you’re in a premium position to get the maximum value for your property. You still need to be smart about your decisions, though. The below tips will help you get the most for your home:

  • Working with a realtor will help  determine the best pricing strategy for your property
  • Consider your closing dates, downpayment, and other key factors when accepting an offer
  • If selling your primary residence, ensure you have secured a new place to live


Flowers Team Real Estate: Your Trusted Guide in All Market Conditions

Navigating market conditions can be daunting, and a misstep can mean missing out on your dream home or losing out on value in your sale. Both market conditions can move quickly and you need to be able to keep up.


Here at Flowers Team Real Estate, we have decades of experience navigating all types of markets. 


Are you looking for a reliable partner that can help you achieve the best outcome from your next real estate transaction? Connect with our team today and see why we’re rated as Milton’s #1 real estate agency.

Amy Flowers

About the Author

Amy Flowers

Broker, CEO & Team Leader — Flowers Team Real Estate

Amy Flowers is the Broker, CEO, and Team Leader of Flowers Team Real Estate, Milton's most-awarded real estate team. A licensed REALTOR® since 2001, Amy has spent more than two decades helping Milton families buy and sell with confidence. Under her leadership, the Flowers Team has been ranked #1 in Milton since 2009 and recognized in the top 1% of Royal LePage agents nationwide. The team offers full turnkey service, including in-house staging, professional photography, and a dedicated marketing department, so every client gets a seamless, concierge-level experience from first showing to closing day.

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