What Is a Buyer's Market vs. Seller's Market in San Diego?

Market Conditions Determine Your Strategy

The balance of power in any real estate transaction is determined by supply and demand. Understanding whether San Diego's current market favors buyers or sellers — or falls somewhere in between — is essential context for crafting a winning offer strategy.

What Is a Seller's Market?

A seller's market exists when demand for homes exceeds the available supply. In a seller's market: homes sell quickly, often with multiple offers; list prices are routinely exceeded; contingencies are often waived; and sellers have leverage to dictate terms. San Diego has been predominantly a seller's market for most of the past decade.

What Is a Buyer's Market?

A buyer's market exists when supply of homes for sale exceeds demand. In a buyer's market: homes take longer to sell; buyers negotiate price reductions and concessions; contingencies are routinely accepted; and buyers have more leverage. True buyer's markets in San Diego's desirable core areas are rare and typically short-lived.

How to Identify Current Market Conditions

• Days on market: Under 14 days average signals a seller's market; over 45 days suggests a buyer's market
• Months of inventory: Under 3 months is seller's market; over 6 months is buyer's market; 3 to 6 months is balanced
• List-to-sale ratio: Over 100 percent (selling above list) signals seller's market; under 97 percent suggests buyer's market
• Multiple offer frequency: If most listings attract multiple offers, you are in a seller's market

Adjusting Your Strategy to Market Conditions

In a seller's market: get pre-approved fully, be ready to move quickly, write clean offers with minimal contingencies, and price your offers at or above list. In a buyer's market: take more time to negotiate, ask for concessions, maintain your inspection contingencies, and know you have leverage if a seller is unresponsive. Rieder Homes Group briefs every buyer client on current conditions in their specific target neighborhoods before they begin making offers.

Related Reading on RiederHomes.com:

→ Blog #46: Getting Started Buying

→ Blog #86: Making an Offer

→ Blog #88: Multiple Offers Strategy

→ Blog #51: Best Time to Buy

— Mance Rieder, Broker Associate | Rieder Homes Group | REAL Broker | riederhomes.com | 858-295-0556