Sellers’ Market

Rising MarketAbout 2 years ago I posted a blog titled “Timing the Market – When to Buy?”.  In this blog I pointed out the common tendencies of Buyers in various market cycles.  “…through the many real estate cycles over the years it has been apparent that when prices in the market are declining, buyers tend to worry that they are going to keep declining, and unfortunately they usually decide to avoid diving in. Then as prices are heating up and hitting all-time highs, buyers tend to panic and typically jump into the fire blindly.” 

Currently, we are in the later part of the market cycle and prices have surpassed all-time highs in most areas, especially in the market I follow most closely, which is Southern California.  True to form, Buyers are in full panic mode right now and are fighting each other to pay the highest prices recorded.  This panic is not isolated to just Single-Family Home buyers, and has spread to Investment Property buyers as well.  Most notably, first-time investment property buyers and rookie syndication property buyers are pushing prices to new heights in the smaller property Retail, Office and Apartment sectors.  The result of this buying frenzy are many happy sellers, and the industry refers to this point in the cycle as a Sellers’ Market.

My quick advice…

  • If you are a buyer, don’t panic. Stay focused on what your investment goals are, and (as a wise investment friend of mine always says) “if it don’t make dollars, it don’t make sense”.  (His grammar ain’t the best.)
  • If you are a seller, the real estate world is yours (at the moment), and you have a multitude of options. One thing to remember, nobody has ever gone broke taking a profit…

So, even though we are in a Sellers’ Market, remember that market trends never go in a straight line one way or the other, and that they are cycles that roll in and out like the ocean tides.

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