Buyers or Sellers Market

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Buyers or Sellers Market

Chris SeveneyBusiness Member

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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

Curious for those who are active in the space.

Do you currently see it as a buyers or sellers market right now?

Do you think in 90 days this will have changed?

Love to get your feedback and opinions.

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JD MartinBusiness Member

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Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 17k+ votes

I think it's about as close to neutral as it might get. There's still no inventory, but there's also less buyers able to afford with high prices and rising interest rates. On the other hand, serious high prices have just killed builders who are only making it on higher-priced builds. If you just looked at historicals you'd say still seller's market for sure, as most places have maybe a month of inventory at historical rates, but I watch a few markets and I'm seeing houses sit for longer and/or have some price reductions.

My personal view is that housing prices don't really come down, they just kind of quit growing and the entire housing market shrinks as a percentage of GDP as both buyers and sellers exit the scene. That will keep housing prices high, but everyone involved in the housing market will get walloped - builders, realtors, movers, financiers, home furnishers, etc.

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Henry ClarkPro Member
Developer · Member since 2020 · 4k+ posts · 4k+ votes
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@Chris Seveney
Still both a Sellers and a buyers market.
I liked the persons comments about looking at the market from a stratification standpoint
Your 90 day out question. Expect the economy to get really bad. You need to position. Still a buyers and sellers market.
Beyond 90:
Interest rates say in the 5 to 7% range are still good numbers. I quit investing at 9%. If I was a fix flip person 15% would be okay. My worse business decision was at 20%. Should have dropped out of college and invested in a $2,000 per year IRA guaranteed at 20% interest. All perspective
Oil is not changing anytime soon.

Food supply will go down and prices go up. Will be not your normal starvation but worse in 3rd world
market was already hot then we dumped $3 trillion dollars on the economy. Forget politics stick to the business side. Any major swing up will go down.
If there is a Republican majority in the house and senate, you still have presidential veto. He is all in, thus the president is not changing course. So another two years
We sold our last subdivision lot at price
Sold our latest SelfStorage location at premium last week. 13 offers all except 3 above asking
Pulled back on our Bond and stock positions. Willing to take the 7% inflation hit there. Our real estate holdings will gain with inflation
Just finished our house in Belize. Now just waiting for the economy to get worse so we can pick up properties down here cheap. Primarily in Teak plantings. Or we will pick up ground cheap where we live and sit on it and do another subdivision.
Our house cost $130,000 in 93. 2,100 sqft full brick. Could sell it for $700,000 or could lower to $600,000. Still a sellers market, just maybe not as greedy.
My point is don’t stick with the same formula. Adjust it.
We had two commercial projects in the $1.5 to $2.5 range we pulled. Had land which we owned, prints and quotes, zoning and financing. No cash needed since the land appraised high enough. We changed directions.
Your perspective is funding and commercial development I believe.
On the funding side it’s the same as always. Get enough collateral. Dont get caught on the rate swings. Start your project planning on higher rates. Only do projects that are fully funded and collateralized in case they pull out

On the development side realize you will want to stay in your lane, but I would be looking at assisted living, retirement, and care facilities. Guaranteed income streams. Guaranteed growing market. Short supply.
The major downside is running them. I would look at build to suit or finance. Key is to look for a product that bridges economic downturns and expand your wheelhouse.
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Ned CareyPro Member
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Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
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@Chris Seveney I don't have clear numbers, but my perception is a mild slowing, but still a sellers market. I am referring to the investor side of the market. Auctions sales are a little more hit and miss as far as sellers getting great prices.
The Baltimore city tax sale from a couple of days ago saw ridiculously high prices. I was getting beat by close to double my bids on some properties. So some investors still have confidence in the market despite their cost of funds going up. Two bidders just told me their credit lines went up 1 percent just recently. Yet they still bid the auction at less than their cost of funds on some properties.
I suspect we haven't seen the full effect of rising rates yet. Investors are biding and putting under contract, without realizing the financing may not come through.
In 90 days I think we will see a dramatically different market. That is enough time for both buyers and sellers to see the reality of the changes that have happened in the financing world.
My prediction is anything from a major crash to continued rising prices at a surprising level. The probability of which result we will see, shaped somewhat like a bell curve, with modest dropping in the middle of the curve.
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Michael Haynes
Investor · Tampa, FL · Member since 2016 · 681 posts · 288 votes
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Hello Chris Seveney, You know Robert Kiyosaki from Rich Dad Poor Dad? I saw him on a youtube video a few months ago, saying that he owns 33,000 Rental Apartments and he is Selling everything.
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Shane Blackshear
Realtor · Austin, TX · Member since 2016 · 52 posts · 18 votes
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Quote from @Ryan Kelly:

@Chris Seveney here in Austin, we've definitely experienced a spike in inventory because of the higher interest rates. It will take several months for buyers and especially sellers to shift to the new normal. As many have said, a majority of sellers are still hesitant to be more conservative with their list price and price reductions are coming back to pre-pandemic levels. The biggest rise in inventory is from new construction, so the prices will soften faster in the suburbs where the homebuilders are concentrated. A well-priced and updated property can still sell quickly.
Echoing Chris here. My listings that would have sold in a weekend last summer are looking like 30 days on market will be likely.
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James Hamling
Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
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Quote from @Michael Haynes:

Hello Chris Seveney, You know Robert Kiyosaki from Rich Dad Poor Dad? I saw him on a youtube video a few months ago, saying that he owns 33,000 Rental Apartments and he is Selling everything.

And let me guess, buying Gold and Silver with all the proceeds....
I love RDPD, love love love it, but just because he did that great thing, it does not mean everything that spill out his mouth is equally great. We have a real celebrity sickness in the U.S. were we do this thing of equating an instance of greatness as meaning great in all things forever. Randy Moss, what an AMAZING wide receiver, and complete and total ultra douc-bag of a person in real life, I had the un-joy and un-pleasure of a few interactions with the guy and every time it hit me how much of a supreme D-bag he was to all, most memorable was when he was flipping out at a gas station over paying for a coffee because "don't you know who i am".... Point is, so many idolized him and he was really great, at that 1 thing, he was far from great at all things.
Kiyosaki has been floundering a fair bit with various ventures over the years. And he's been banging the gong of how the sky is going to fall for roughly a decade now. I put 0 credit or thought into him selling his portfolio, not just for all that but also he is what, 70+ now, and a Billionaire, yeah, in those shoes, I'd probably go buy an island, build an entire city on it, buy a moth-balled destroyer and invite my friends to have a fun filled weekend of just blowing the place up for S&G, just because I could. Point is, when few years of life left and unGodly amounts of money, one can afford to do crackers things and it will have little to no affect on them.
Maybe focus a bit on how he became a bazillionaire in the first place.
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Kelly Asmus
Real Estate Broker · Portland, OR · Member since 2018 · 126 posts · 71 votes
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Oregon is still a seller's market though everyone is just taking a giant breath right now as markets adjust to the new world order of higher interest rates. We are so inventory short that it will be awhile before we see a buyer's market again though I believe with the rise in rates we will move back toward the middle - toward a more balanced market for 2023. Some price ranges here have no inventory so we're still seeing competition for homes in the lower price ranges, detached. Upper price ranges we're seeing homes sit on the market more than a few days... so interest rates are causing those buyers to pause. We're not seeing the overbidding we saw the last year. We're seeing moderate bidding on some properties. Agents and sellers who went aggressive on price are seeing some roll backs to reality and I'm seeing some properties pend for less than list. Everyone is adjusting but market is still moving along and more inventory is coming to the market.
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Sara Frank
Realtor · Baltimore, MD · Member since 2020 · 255 posts · 182 votes
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Quote from @Ned Carey:

@Chris Seveney I don't have clear numbers, but my perception is a mild slowing, but still a sellers market. I am referring to the investor side of the market. Auctions sales are a little more hit and miss as far as sellers getting great prices.
The Baltimore city tax sale from a couple of days ago saw ridiculously high prices. I was getting beat by close to double my bids on some properties. So some investors still have confidence in the market despite their cost of funds going up. Two bidders just told me their credit lines went up 1 percent just recently. Yet they still bid the auction at less than their cost of funds on some properties.
I suspect we haven't seen the full effect of rising rates yet. Investors are biding and putting under contract, without realizing the financing may not come through.
In 90 days I think we will see a dramatically different market. That is enough time for both buyers and sellers to see the reality of the changes that have happened in the financing world.
My prediction is anything from a major crash to continued rising prices at a surprising level. The probability of which result we will see, shaped somewhat like a bell curve, with modest dropping in the middle of the curve.

I agree with Ned there seems to be a rush of investors listening to the constant media hype that its now or never to park their money in real estate so they are overpaying for it. It's important to hedge against inflation but I'm seeing financing fall through because appraisals are starting to stabilize and cost of capital will keep going up. I cant speak to what's going to happen long term, but I know I've been able to get appraisal and/or inspection contingencies for many of my clients recently when that wasn't an option 90 days ago. We're far from a buyers market, there's just not enough inventory, but there has been softening. We'll see how it develops.
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Ned CareyPro Member
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Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
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To follow up on what I said earlier and @Sara Frank just said, my wife and I just put in an offer last week for a home for ourselves in Baltimore. It had an inspection contingency and it was accepted.
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Guillermo Perez Vargas
Investor · Scottsdale, AZ · Member since 2009 · 23 posts · 5 votes
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Quote from @Chris Seveney:

Curious for those who are active in the space.
Do you currently see it as a buyers or sellers market right now?
Do you think in 90 days this will have changed?
Love to get your feedback and opinions.

I'm in Phoenix AZ, so my opinions are valid only here. We just closed a Buy&Hold after holding for 10 yrs. we made a good profit BUT...
In June, houses where selling in less than 1 week! Ours was on the market 6 weeks. I'm seeing multiple price drops on the MLS. Houses have very few if any showings and have been on the market over 8 weeks.
On the property we sold we were lucky to not have to make any concessions, but if we were selling now, I would be ready to price aggressively and make concessions.
I think we are moving into a buyers market very quickly.
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Dustin P.
Realtor · Tempe, AZ · Member since 2017 · 541 posts · 442 votes
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Quote from @Guillermo Perez Vargas:

Quote from @Chris Seveney:

Curious for those who are active in the space.
Do you currently see it as a buyers or sellers market right now?
Do you think in 90 days this will have changed?
Love to get your feedback and opinions.

I'm in Phoenix AZ, so my opinions are valid only here. We just closed a Buy&Hold after holding for 10 yrs. we made a good profit BUT...
In June, houses where selling in less than 1 week! Ours was on the market 6 weeks. I'm seeing multiple price drops on the MLS. Houses have very few if any showings and have been on the market over 8 weeks.
On the property we sold we were lucky to not have to make any concessions, but if we were selling now, I would be ready to price aggressively and make concessions.
I think we are moving into a buyers market very quickly.

I can attest for this in Phoenix. Trending very hard towards a buyer's market, maybe a month away
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