What is a seller's market?

A seller's market is characterized by a situation where the demand for homes exceeds the available supply. In this scenario, the number of buyers looking to purchase homes is greater than the number of homes available on the market. This imbalance typically leads to an increase in home prices, as buyers compete to secure a property. Consequently, sellers may find themselves in a favorable position, often receiving multiple offers and having the leverage to negotiate higher prices or more favorable terms.

The other options depict different market conditions. A market with more homes than buyers describes a buyer's market, where prices tend to decline due to increased supply. A stable market refers to a situation with consistent prices and sales, contrasting the dynamic nature of a seller's market. Lastly, limiting the concept to luxury homes does not accurately reflect the broader definition of a seller's market, which can apply across various segments of real estate, not just luxury properties.