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Hello there, my name is Shriraam Murugathas and I have created this padlet page to complete my College level course General Elective where I will explore the in-direct and direct relationship between the Role of a buyer and seller in the economic market. In this wall I will use many different resources including but not limited to online videos, websites pertaining to this topic and a few images. Each resource used will have descriptions detailing about them and link that you can follow to visit said resources. I hope you find this informative as well as entertaining!

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Everyone wants to be an expert in determining whether we are in a buyers or sellers market.

Most people just guess, but there is a more accurate measure. It's called the Sales-to-New Listings ratio. You take the number of sales over a period of time, usually a month, and divide it by the number of new listings for the same period. That is a flow to flow concept. Some people try to use 'Active Listings', but that is a stock value and is really meaningless.

Most experts agree that range for a balanced market is in the 40%-60% range. Under 40%, it is a Buyers Market, and over 60%, it is a Sellers Market.

A Criticism of agents, is that we just cancel and relist to refresh a listing. That would then understate the real percentages and would create a bias for a Buyers Market.

In the GTA, the current ratio is 51%. Last year at this time it was 47%. The size of this market is too big to help individual buyers and sellers. Just focus on 416 and the number is 56%, almost a Seller's market. Look at just downtown condos, and the number is now 60%.

My suggestion? A good agent will get you the percentages for the exact market you are interested in. Then you will know how to deal in making or receiving an offer.

Want to stay up to date on our monthly market reports?

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How to Determine a Buyers' or Sellers' Market | Toronto Real Estate Blog - RE/MAX Condos Plus

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Everyone wants to be an expert in determining whether we are in a buyers or sellers market. Most people just guess, but there is a more accurate measure. It's called the Sales-to-New Listings ratio. You take the number of sales over a period of time, usually a month, and divide it by the number of new listings for the same period.

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How to Know if it's a Buyers Market or Sellers Market

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How to Tell if it's a Buyer's or Seller's Market & Why It Matters

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Econmentor.com - Role of buyer and seller in market clearing prices

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The two basic terms used most often by economists are supply and demand. The amount of something that is available - the supply - and the amount of something that people want - the demand - make up a working market. The market is the way in which an economic activity is organized between buyers and sellers through their behavior and interaction with one another. Buyers, as a group, determine the overall demand for a particular product at various prices while sellers, as a group, determine the supply of a particular product at various prices.

The interaction of buyers and sellers in the market helps to determine the market price, thereby allocating scarce goods and services efficiently. The price is taken into account when deciding how much of something to consume, and also how much to produce. The relationship between price and quantity demanded is so universal that it is called the law of demand. This law states that with all else equal, when the price of a good rises, the quantity demanded falls - and when the price falls, the quantity demanded rises. The supply curve provides the opposite information: the higher the price, the higher the quantity supplied - and the lower the price, the lower the quantity supplied.

A key function of the market is to find the equilibrium price when supply and demand are in balance. At this price, the goods supplied are equal to what is being demanded thereby bringing about the most efficient allocation of the goods. An efficient allocation of goods in a market is one in which no one can be made better off unless someone else is made worse off.

There are influences other than price, however, that can play a role in keeping the market from being truly efficient and at equilibrium.

Variables that Influence Buyers (Demand)
- Price
- Income
- Prices of related goods
- Tastes
- Expectations
- Number of Buyers

Variables that Influence Sellers (Supply)
- Price
- Input prices
- Technology
- Expectations
- Number of Sellers

On the demand side, income can play a significant role. As income rises, people will buy more of some goods or even begin to purchase higher quality - or more expensive - goods. The price of related goods can also alter demand. If the price of one cereal increases, for example, demand will likely switch to a similar cereal - which would be considered a substitute good. If the goods are considered to be complimentary - or are typically used together - a decrease in the price of one of the goods will increase the demand for another. An example of complimentary goods are cars and gasoline, where the price of gasoline depends partly on the number of cars. Personal tastes and expectations of the future also influence individual demands as does the number of buyers (an increase in buyers vying for a specific number of goods will increase the demand and likely increase the overall purchase price).

On the supply side, both expectations and the number of sellers can influence the number of goods produced. In addition, the cost of producing the good - or the input prices - and the level of technology used to turn the inputs into goods greatly influence the final price and quantity supplied.

Although most economic analyses focus on finding the market equilibrium, there exist a number of other market forms. When it comes to the utilization of natural resources or other environmental quality amenities, it is often difficult to find the equilibrium through mere market pricing since they are not true market goods. Efficiency would require maximizing current costs and benefits of using or extracting natural resources while taking into consideration future costs and benefits, including the intrinsic and existence value of the resources. When the market fails to allocate the resources efficiently, market failure can occur. An example of this is the creation of externalities which often occurs when clear property rights are absent, as with air and some water resources. Attempts to promote efficiency and bring the market back into equilibrium can be through market options, like economic incentives and disincentives, or the establishment of property rights, or through government intervention.
Updated by Dawn Anderson
Recommended Resources

Price Theory, Lecture 2: Supply and Demand
Glen Whitman, an Associate Professor of Economics at California State University, Northridge, compiled information on his website based on his lecture notes. He includes principles of supply and demand, constructing the market, and various types of competition.

Supply and Demand
An excellent summary on the topic by Wikipedia, the free encyclopedia.

Introduction to Economic Models of Natural Resource Utilization
Richard Kazmierczak, Jr., an Associate Professor at Louisiana State University compiled this information based on his class in Natural Resource Economics.

For the Classroom

EconEdLink: To Market To Market
This lesson has students become consumers and producers by taking turns buying and selling things in a classroom-created market. Students establish prices for items and observe what happens during the sale of those items. [Grades K-5]

Fill'er Up Please: A Lesson in Supply and Demand
This EconEdLink activity provides students with an opportunity to learn about gas prices and how prices in general affect both consumer demand and producer supply. [Grades 6-8]

Learner.org: Workshop 2 - Why Markets Work
This workshop includes a market simulation and exercise, "A Classroom Market for Crude Oil" (beginning on page 32) to illustrate key concepts of the market. Special emphasis is given to the interplay of supply and demand - how they can affect prices, and how prices can work as incentives for consumers and producers. [Grades 9-12]

References

Economics basics: Demand and Supply from Investopedia.com

Mankiw, N. Gregory, Principles of Economics. Mason, OH: South-Western College Publishing, 2003.

The Concise Encyclopedia of Economics from the Library of Economics and Liberty.

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Supply & Demand: How Markets Work - The Environmental Literacy Council

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The two basic terms used most often by economists are supply and demand. The amount of something that is available - the supply - and the amount of something that people want - the demand - make up a working ... Continued

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Real estate transactions can be time consuming, overwhelming, and expensive, regardless of whether you are the one buying or selling, and, depending on its condition, the state of the market in your area can either alleviate or exacerbate these feelings.

Generally, a healthy real estate market benefits both buyers and sellers, with a variety of homes available to choose from and relatively stable and affordable prices that are based on the financial health of the location you're in. But sometimes, the scales can tip one way or the other, which can end up benefitting one party more than the other. These markets are most often referred to as either buyer's markets or seller's markets.

So, what exactly do these terms mean to buyers and sellers and which party benefits most from which market? We'll cover that and more in this post in order to give you a clear understanding of which market conditions you may want to conduct your next real estate transaction in.

What is a Buyer's Market and Who Benefits From it?

A buyer's market refers to a real estate market in which there are a lot of competitively priced homes available for sale in a specific location, like a city. In this type of market, buyers typically have the upper hand.

In a buyer's market, home sellers must compete with one another to sell their properties. With so many homes on the market, home buyers can be pickier about things like the curb appeal of the home, what renovations or upgrades have been done, and, most importantly, the price.

This means that home sellers who are highly motivated to sell may need to lower their asking price, complete high-value renovations (like a kitchen or bathroom revamp), or offer other incentives that could encourage a buyer to commit (like including a home theatre system or upgraded appliances in the sale of the home).

Buyers also have more opportunity to negotiate pricing in this type of market, and a homeowner who needs to sell their home may be more open to accepting a lower offer on their home than what they paid for it or what it has been appraised for, depending on how desperate they are to sell.

However, home sellers who can stand to wait may want to hold out for a more stable market, or, if they can, a seller's market, in which they would have potential to reap significant financial benefits.

What is a Seller's Market and Who Benefits From it?

A seller's market is when there are a lot of home buyers looking to purchase, but few homes on the market in a given area. Sellers benefit the most in these market conditions.

Contrary to a buyer's market, in a seller's market, home buyers are the ones who must compete with each other for available homes. This means that sellers can up their asking prices, sell homes that may not have sold otherwise (for example, homes that need significant repairs or upgrades), and may even be able to reject lower offers and hold out for better ones with confidence.

In some seller's markets, home owners can see their homes sell for significantly more than they initially paid for it.

What Causes a Buyer's or Seller's Market?

The real estate market can be influenced by a number of different factors that can determine whether home buyers or sellers will come out on top.

Some of the most impactful market fluctuations can be caused by:

The local economy

Take an area like Silicon Valley, for example. It's considered to be a global tech center, attracting tech professionals from all over the world to work for some of the biggest and most well-known companies that exist today, such as Google, Facebook, Apple, and more. Startup hopefuls and tech professionals flock to the area to live and work in one of the world's most influential tech hubs.

With a booming economy comes a need for housing, which is a major issue that affects the market in Silicon Valley. For example, in Cupertino (where Apple is headquartered), the median home value is $2.2 million. This makes Silicon Valley a seller's market since there are fewer homes available for purchase and their listing prices can be astronomical.

Alternately, if the local economy were to suddenly plummet in Silicon Valley, it could easily become a seller's market, with people who purchased high-priced homes looking to get rid of them quickly and at a potentially lower asking price.
The neighborhood
Home values can also fluctuate based on the neighborhoods they are located in. For example, if a city plans to revitalize a previously worn-out and undesirable area by building a new NHL arena, it's likely that those developments will influence and encourage a seller's market at some point.

As well, other homes in the area can affect the market. For example, in a newly-developed subdivision, there won't be existing historical property values to base purchase prices off of. Instead, sellers will need to determine a price based on other factors, like the cost to build the home and so on. However, the more people that purchase homes in the area, the more desirable it becomes, which can lead to a seller's market as well.
Historical property value and desirability
While less focused on time-sensitivity than things like booming economies and new amenities, historical property values and the location's reputation can also play a role in what type of housing market takes precedence in a given area.

In areas with low desirability (either from crime, lack of amenities, poor curb appeal, etc.), houses tend to be less expensive, with historical property values that reflect that, even if they are new builds or upgraded homes.

In areas with low historical property values and desirability, buyers may be able to take advantage of new developments in up and coming areas where prices may be lower than other areas where historical property values are higher. Buyer's markets can happen in new subdivisions where property values have yet to be adjusted for the newly developed area, getting buyers more bang for their buck.

Determining The Best Move For You

Whether you are buying or selling, chances are you have little to no control over the housing market in your area. The best that you can do is to pay attention to the trends, consider your motivations and timeline, and sell or buy in the most ideal market conditions that you can. While buyer's and seller's markets can tip the scale, buying or selling in a stable and healthy market isn't a bad option either, so focus on your goals, keep an eye on the market, and time your move as strategically as you can to get the most out of your next real estate transaction.

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Buyer's and Seller's Markets: The Basics - LawDepot Blog

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Real estate transactions can be time consuming, overwhelming, and expensive, regardless of whether you are the one buying or selling, and, depending on its condition, the state of the market in your area can either alleviate or exacerbate these feelings.

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How to recognize what market you're in

So, what type of market are you currently in? That depends on a number of things, including how many homes are for sale in your area, the number of people looking to buy, home prices, and more.

Here's what the general conditions look like under each market.

In buyer's markets:

There are lots of listings and homes for sale

Few people are looking to buy a house

Sellers are more willing to negotiate

Home prices have dropped or are dropping

In seller's markets:

Inventory is low and listings are scarce

There's lots of buyer demand and competition

List prices are rising

Bidding wars and multiple-offer scenarios are increasing

Buyer's markets: What they mean for buyers and sellers

If you're in a buyer's market, supply outweighs demand. There are more listings available than there are buyers, and sellers need to work harder to market and offload their homes.

As a buyer, that's a good thing. You'll probably have your pick of listings, and you might be able to negotiate more as well. You won't come up against many bidding wars, either, so you could see a faster, smoother transaction on the whole.

As a seller, conditions aren't great. Selling in a buyer's market will probably take a little longer, and you might not get the price you're hoping for in the end. You'll need to be willing to negotiate, get creative with your marketing, and maybe even throw in some concessions (like the cost of repairs or new appliances) to motivate the few potential buyers who are out there.

Seller's markets: What they mean for buyers and sellers

If you're in a seller's market, then demand outranks supply. There are more buyers on the market than there are listings, and buyers see tough competition for the few homes that are available.

As a buyer, this isn't the ideal market. You will probably come up against other offers and may find yourself in a bidding war (or several). You also may need to up your offer, waive contingencies, or make other moves to ensure your bids are attractive to sellers. Overall, it may take you longer to find a home that fits within your price range.

As a seller, this is the prime time to sell a home. You might be able to increase your listing price a bit. And as long as your home is in good condition, you can pretty much have your pick of buyers. You can also expect your property to sell fast, and you may be able to avoid some hassles in the process. Waived inspections and all-cash offers are more common in seller's markets.

The bottom line

Whether you're buying a home, selling one, or just thinking about a future investment, it's important to know what type of market you're in before making any moves. If you're not sure what your market conditions look like, speak to a local real estate agent for insights. They may also be able to help you strategize as you get further into the transaction.

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Buyer's Market vs. Seller's Market: What It Means and How It Should Influence Your Strategy

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So, what type of market are you currently in? That depends on a number of things, including how many homes are for sale in your area, the number of people looking to buy, home prices, and more. Here's what the general conditions look like under each market.

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Infographic | How does a balanced market affect buyers and sellers ...
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edinarealty.com

The 2019 US Housing Market: A Seller's Market or Buyer's Market ...
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mashvisor.com

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role of buyers and sellers in the market - Google Search

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Infographic | How does a balanced market affect buyers and sellers ...800 × 540 - 156k - pngedinarealty.com The 2019 US Housing Market: A Seller's Market or Buyer's Market ...1024 × 576 - 128k - pngmashvisor.com