What distinguishes a "sellers’ market" from a "buyers’ market"?

A sellers’ market is characterized by a situation where there is more demand for properties than the available supply. This increased demand can lead to higher property prices, as buyers are often willing to compete for a limited number of homes, resulting in bidding wars and offers above asking prices. In contrast, a buyers’ market occurs when there are more homes available than there are buyers interested in purchasing them. This shift typically leads to a decrease in property prices and longer time on the market, as sellers may need to lower their prices to attract buyers.

Understanding the fundamental economic principle of supply and demand is essential in real estate markets. In a sellers' market, the imbalance in favor of sellers gives them the advantage, while in a buyers' market, the opposite is true, providing buyers with more negotiating power.