Is it a “Buyer’s Market” or a “Seller’s Market” ?
One of the most asked questions for anyone who works in the real estate industry is: “How is the real estate market now?”. Honestly, I get asked this question everyday once and the easiest answer is – it depends!
It truly does depend on a lot of factors and it seems like it is changing everyday based on the supply and demand in a given community. Certain markets such as ready villas in Palm Jumeirah, you can find that there is HIGH demand and LOW supply. In this case Seller’s here have a higher bargaining power and can raise prices to as there are more buyers for a limited number of villas available in this area. Therefore, it is considered a Seller’s market.
If you look at another segment in Dubai, such as affordable apartments in Al Furjan. Here you can find HIGH supply and LOW demand. In this particular location you can find more apartments to choose from, so a buyer has a wide choice and a higher bargaining power to negotiate better terms. Therefore, this is considered as a Buyer’s Market.
This basic economic principle is handy to understand in the real estate market and can be a good indicator of the following:
- For an investor or buyer, you can see when to enter the market and the get most of your budget especially when there is more supply.
- For a seller, you can understand if it is worth holding out for a while longer to get more out of property if you can see the supply in your community being reduced.
- For a developer, you can see when it would be a good time to launch a project at possibly higher price points or to introduce new inventory in the market to get more sales based on the indicators in the market.
How can you know if it is a buyer’s market or a seller’s market? The easiest way is to read your local news articles about the real estate market and to check out listings on property portals in your area. Furthermore, have a look at published quarterly reports by research authorities along with the statistics published by the local land department authorities. The DUBAI REST app by the Dubai land Department can give you access to a lot of relevant information.
You can also speak to a real estate advisor or consultant that you are in contact with, as they tend to be well-informed of the actual market versus just speculation. So feel free to ask our opinion on the real estate market and we can let you know more details based on which segment you are looking at. Feel free to arrange a call back here or chat with a specialist here.
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