It may seem obvious: timing is everything when it comes to selling your home. But how do you predict the right time to list your home, especially when you're planning to purchase or build a new home? There are two different types of housing markets, and one is far more beneficial to the other as a homeowner looking to sell your home. One is a buyer’s market, and the one most beneficial to you is the seller’s market.

What does this mean exactly? A seller’s market is an economic situation that favours the home seller over the buyer. There are fewer homes on the market and more buyers seeking to buy, meaning there's less competition out there. This means homeowners are able to keep their asking prices a bit higher as a result. As you’ll see below, this is a huge benefit to homeowners building a new custom home.

The period between February and May is generally the strongest home-buying season of the year, and a seller’s market in this season is an ideal time to list your home for sale. Here are a few reasons why:

Faster Offers

With little competition on the seller’s side, homebuyers are likely to make a decision faster on which home to buy. There's far less selection to choose from with more buyers eyeing up the same home, forcing buyers to make quicker offers to avoid missing out on the home they choose.

Virtually Guaranteed Sale

With so many buyers seeking a new home and fewer homes to choose from, the likelihood of selling your home is much higher. Chances are, someone will fall in love with your home and act quickly to purchase.

Bidding War

In a seller’s market, buyers are generally better qualified to purchase. These buyers are willing to purchase in a higher-priced market, generally meaning they will make not only a solid offer on your home, but you may also receive multiple offers which could end in a bidding war. Homes are more likely to sell higher than list price in a seller’s market.

Better Negotiations

In an opposite buyer’s market, homebuyers are usually able to make demands attached to their offer to purchase such as home repairs, including furniture and/or appliances, paying the buyer’s closing costs and/or Realtor fees, etc.

In a seller’s market, however, these demands are rare, and offers to purchase are usually much smoother with no contingencies on the sale.

Peace of Mind – Your Home is Sold

One of the biggest challenges, when buying a new home and selling your old one, is the worry that your old home won’t sell in time. In a seller’s market, buyers are moving faster and making higher offers, increasing the chances that your home will sell in time for you to move into your new home.

Larger Profit on the Sale = Pays for High-End Upgrades

If you're building a new custom home, a seller’s market yields higher profits on the sale of your old house. This could help you put down a larger down payment on your new home, which offers its own benefits.

These profits could also allow you to turn your new custom home into your ideal palace through high-end upgrades, customizations to make your new home truly your own, or additional features you may not have included on your original budget. This could mean adding a finished basement, completed landscaping, solar panels or other energy-saving mechanics, or other such features.

Careful Timing

Even though sellers have the upper hand in this type of market, if you're building a new home you’ll need to watch closely for the right time to list your old home for sale. In a seller’s market, purchases can be fast-tracked.

Buyers will likely be looking for a possession date sooner than later, and if your new home isn’t quite ready by the time your new homeowners want possession, you may need to make arrangements to live elsewhere temporarily. This could prove to be an undesirable situation, so be sure to watch average list-to-sale times for your area before deciding when to list your home.

Building a custom home is a refreshing time in one’s life; to build exactly the home you need and want is a wonderful start to a new chapter. By selling your existing home in a seller’s market, you can make your experience that much better by having the upper hand and potentially earning more profit to put toward your new custom home.

Photo credits: paper sales, couple buying, handshake