Sellers Market

Increasing demand for homes drive up prices. Thus, when there is more demand for homes than homes available on the market, it is a Seller's market. Examples causing that are: low home inventory, increased demand when influx of people moving into an area where not enough homes are available, Interest rates trending downwards which increases home affordability, etc.

The opposite is true for a Buyer's market - this environment typically results in fierce completion amongst the buyers due to such limited property inventory to choose from. Buyers have to move quickly and make fast decisions and be prepared to pay more than asking.