If you’re looking to buy a house, there are probably some terms that you haven’t heard before. Many industries have their own lingo and different meanings for words we’re already familiar with. The real estate industry is no exception. As spring approaches, typically the largest and most competitive season for the real estate market, there’s one term that might start floating around a lot more.
I’m sure you’re familiar with, or can at least hazard a guess, as to what a buyer’s market and a seller’s market are. Simply put, a buyer’s market means the housing market is better for the buyer. House prices are low, and there’s not too much competition. A seller’s market, however, means that the housing market is better for the seller. It’s supply and demand. If there are fewer houses on the market, the sellers can list their houses for more, and bidding wars are more frequent as multiple buyers are all trying to buy the same house.
This is where low inventory comes in. While it’s not common practice to think of a house as a piece of inventory, that’s exactly how it works in real estate. An entire industry exists around the buying and selling of properties, so it makes sense that in order to buy and sell something, that property has to exist. If there is less real estate on the market, there’s less inventory. Not as many buyers will be able to find a home, or real estate.
This contributes largely to a seller’s market. When inventory is low, and demand is still high, the market drives prices up according to the laws of supply and demand. As we get closer and closer to spring, you’ll most likely hear more about low inventory. It’s not just a buzzword thrown around by real estate agents; it actually means something. What it means for you, though, can depend entirely on if you are buying or selling a home, and if there is or isn’t low inventory.
Entering a Competitive Market
If you’re listing your house, low inventory is a good thing for you. This means that there are fewer houses on the market, which increases demand. It’s the perfect time to sell your house, because it will most likely go quickly as buyers are searching for a home.
Of course, if you’re on the other side of that coin, as you probably are if you’re looking at Idaho real estate, low inventory isn’t as good. But that doesn’t mean you need to give up. You just need to be prepared.
Don’t be scared away by talk of low inventory. If you’re ready to buy a home, just go in smart. Secure financing ahead of time by getting a preapproved loan. This will let the seller know that you are serious, and you already have your financing lined up. They won’t have to wait, and neither will you.
This gives you a huge advantage over a buyer that hasn’t been preapproved. They’ll still have to secure a loan to buy the house, and there’s no guarantee that their funding won’t fall through. Your preapproved loan means that won’t happen, and you’ll be a much more attractive buyer.
It also doesn’t hurt to hire a buyer’s agent. Like the real estate agent for the seller is looking out for the seller, a buyer’s agent is looking out for you, the buyer. They’ll know to make a competitive offer, and they’ll have experience navigating a low inventory market. Plus, their insight into the local neighborhoods, and potential relationships with other real estate agents will give you an advantage, because you have someone fighting in your corner.
Don’t Let “Low Inventory” Hold You Back
Living in Idaho is a dream come true. Don’t be scared away by talk of low inventory. Buying a home might be a bit more challenging, but as long as you are prepared and aware, you won’t have anything to worry about.
With the help of a local agent, you’ll have nothing to worry about with low inventory. While you might have to pay closer to list price, you’ll still be able to move into the house of your dreams. Be prepared, stay strong, and before you know it, you’ll be living the Idaho dream, with the beauty of nature just beyond your lawn.