To determine a trend, it is necessary to analyze whether the days on the market are increasing indicating a shift toward a Buyer’s market or decreasing, thus indicating a shift toward a Seller’s market.

 

The determination of when it switches from a Seller’s to a Buyer’s market is difficult to pinpoint. The trend toward a Buyer’s market is easier because the days on the market are increasing.   When this happens, there are more homes on the market competing with each other for the available number of sales per month. 

In rapidly increasing or decreasing markets and when the competition is stronger, the subject property should be priced slightly ahead of the market. Only in a rapidly rising market, can a home be priced slightly ahead of what the market indicates. However, when the market is declining, the home should always be priced slightly below what the market indicates.

 

It takes a certain amount of time to get the home exposed to the market and it needs to have the competitive price advantage at that point. If it doesn’t get this initially, the property will be trailing the declining market and generally never achieves that advantage.