I mentioned in my other post (Link: The Market Is So Tough Right Now) that the trade-up-buyer is getting their chance to be considered as a viable option to a seller more than they have in a really long time…
A ‘trade-up-buyer” is commonly a buyer of a property that has a house or property they need to sell in order to buy a new one. Usually they haven’t put this property up for sale until they a have a suitable up-leg or future home, because they don’t want to sell what they are living in without knowing where they are going to be moving to.
There are a couple of dynamics this causes in the market. Sellers tend to get a little more money from buyers with a property to sell or “contingent buyer” than they would from a strong buyer with no house to sell or even no loan to get. So this in a way helps keep prices from dropping. This also creates new inventory for the market that we haven’t been experiencing in the past because these “contingent buyers” are now putting their home on the market and usually at market prices or slightly below market so they can sell their house and get the one they want to trade up to. Before with “all cash” buyers and” non-contingent“ buyers, there wouldn’t be a house coming to market as a direct result of a house being purchased which was keeping inventory at a very low level.
This in my opinion is what a normal market actually looks like and is what I would consider a healthy and level market. It’s creating opportunities for a lot of buyers and sellers and overall I think is a great thing for the market in general.