If you’re new to real estate lingo, you might be wondering what low inventory means for selling your home.
Low inventory is when the amount of homes available on the market is at its lowest. Be it from seasonal cycles (sellers tend to sell during spring and summer), employment rates, or unforeseen circumstances (such as an economic crisis), a decrease in homes on the market makes for an increase in demand.
No matter the reason, there are many benefits to selling your home when inventory is low.
Easier to Sell
It’s no surprise that less houses on the market makes for an easier time selling a house. If you’re hoping to sell a house that is in a low demand area, you can boost your chances of sealing the deal by listing during a time when inventory is low because buyers have limited options from which to choose.
Higher Sale Price
If your home is well-maintained, in a popular area, and move-in ready, selling it when inventory is low means you might be able to sell for a higher sale price. Take advantage of the higher demand for sellable homes by hiking up the price.
Better Return on Investment
Because you can potentially sell your home for a higher sale price, you have the advantage of increasing the return on investment for your house by using your equity as leverage.
Throwing in a few light renovations can further increase your ROI during a time of high demand because the pickings are slim for buyers, increasing their likelihood of settling on a house. Having a low inventory market means you don’t need to go all out to renovate your house.
Better Contract Terms
With lower inventory comes better contract terms. Since buyers are all trying to buy from the same, limited stock, there may be bidding wars over your house. This gives you the upper-hand for negotiating better contract terms. With this extra wiggle room, you can plan your contract as you see fit, rather than having to cater to the needs of the buyers.