"It means that external conditions such as supply and demand, comparable sales in the neighborhood, the economy, public opinion, confidence in the future, and changes in the tax code all favor buyers," says Robert Elson, a real estate broker with Coldwell Banker Warburg in New York.

These factors create an ideal scenario for buyers in the real estate market.

What does this mean for buyers?

In a buyer's market, buyers are more likely to get a sweet deal on their purchase.

"If you're in the market for a new home, this is an ideal time to buy," says Jordan Skurnik, a licensed real estate salesperson with Citi Habitats in New York.

Why? "You may be able to take advantage of excess inventory and get your dream home at a lower price," Skurnik says.

And, because the market is less competitive, he says you may have more time to make a decision and less chance of getting caught in a bidding war.

You may also be able to secure some additional benefits.

"With less competition, buyers can negotiate with sellers, including a home warranty, to pay some of the closing costs," says Candice Williams, a Re/Max Space Center real estate agent in League City, Texas.

Plus, she says, buyers in such situations usually have control over the closing date.

But don't get too excited. In a buyer's market, no one is going to give away their home. While you may get a deal, you probably won't get a steal.

"If your budget allows $800,000, don't aggressively pursue a million-dollar property," warns Daniele Kurzweil, a licensed real estate salesperson with the Friedman Team at Compass in New York City. It's still wise to stick to your budget so you can avoid financial headaches if the market changes in the future.

What does this mean for sellers?

As you can imagine, a buyer's market is not a particularly good time for sellers.

"With so many other sellers vying for the same buyers, sellers may find their properties languishing on the market, sometimes for a year or more," says Dolly Hertz, a licensed associate real estate broker with Engel & Völkers New York Real Estate.

It can be advantageous to make sure your home is ready to move in and shows well in photos. If the house isn't ready, Williams says sellers should be open to offering additional perks, such as paying closing costs or carpet or paint allowances.

"Also, if your home has a unique or unusual feature - a larger than average backyard, secret rooms, etc. - it's important to emphasize that feature to buyers," Williams says.

Are we in a buyer's market or a seller's market?

The last few years have been pretty tough for homebuyers. December 2020 saw mortgage rates hit record lows; this then triggered a buying frenzy that made the market very competitive. Buyers found themselves having to bid above asking prices and forgo contingencies just to compete with other buyers and make their offers stand out. At the time, Realtors shared anecdotes of receiving an average of 10 (or more) offers per house. These circumstances put us in a total seller's market.

Today, of course, the real estate market has slowed considerably. Mortgage rates are hovering in the 6% range, which affects the affordability of homes and keeps buyers and sellers at bay. This stagnation is also a result of high home prices. in May, the median listing price increased to $441,000, up from $430,000 in April. Experts predict that prices will climb even higher in June.

So while we're certainly not in a seller's market like we've never been in 2021, we can't call the current conditions favorable for buyers either.

But there are some glimmers of hope on the horizon.

"Based on current trends, there's a chance in our data that [home prices] won't reach the previous year's peak for the first time," says Sabrina Speianu, economic data manager at Realtor.com.

In addition, homes languished on the market for a median of 43 days, 14 days longer than last year. And the number of listings with price reductions rose from 10.2 percent in May 2022 to 12.7 percent this year. These two factors suggest that demand for homes is lower than it was a year ago at this time for the nation's housing market as a whole.