Finance
What is seller's market?
A seller's market is one where buyer demand exceeds available inventory, giving sellers pricing power, shorter selling times, and frequently multiple competing offers.
Typical markers are low absorption rate, falling days on market, a high ratio of sale price to asking price, and buyers waiving contingencies to make offers more attractive.
For sellers this is favourable but not risk-free: pricing above what an appraisal will support creates a financing gap that can collapse a deal weeks in. For buyers it means competing on terms — timing, contingencies, certainty — rather than only on price.
Conditions are local and segment-specific. Neighbouring price bands in the same city can be in opposite conditions simultaneously.
Related terms
A buyer's market is one where available inventory exceeds demand, giving buyers negotiating leverage on price, terms and repairs, and leaving sellers competing for a smaller pool of purchasers.
Absorption rate measures how quickly available properties are selling in a market, usually expressed as the number of months it would take to sell all current inventory at the recent pace of sales.
A contingency is a condition written into a purchase contract that must be met for the sale to proceed, allowing the buyer to withdraw without losing their deposit if it is not.
An appraisal is a formal opinion of a property's market value produced by a licensed appraiser, most often commissioned by a lender to confirm that a property is worth enough to secure the loan against it.