A buyer’s market is simply defined as a market in which there is more supply than demand. This naturally means that one buyer has multiple options in the market and those options (houses in this case) may have to compete for the buyer’s attention.
Several factors may influence both long-term and short-term buyer demand, including Economic disruption when a large employer ceases operations or laying off employees.
Interest Rates Trending Higher- Because interest rates are higher, fewer people can borrow as much money to purchase a home, lowering the market’s overall supply of potential buyers. Due to decreased demand, home prices decline, and buyers may discover better deals.
Short-term drop in interest rates- can provide borrowers with a temporary advantage by providing more purchasing power before home prices react to recent interest rate changes.
High Inventory- a new subdivision can drive down the prices of nearby older homes, especially if they lack highly desirable features.
Natural Disasters- Recent earthquakes or flooding can cripple property values in the area where the disruptions occurred.