What characterizes a buyer's market in real estate?

A buyer's market in real estate is characterized by an excess supply of properties available for sale. This situation often arises when there are more homes on the market than there are buyers looking to purchase them. As a result, buyers have greater leverage in negotiations, which may lead to lower prices and more concessions from sellers.

In a buyer's market, the competition among sellers often drives prices down, allowing buyers to take their time when making decisions without the pressure of multiple offers on properties. The dynamics shift to favor buyers, who can negotiate better terms such as lower prices, repairs or upgrades before closing, and closing cost assistance.

The other scenarios presented do not describe a buyer's market accurately. A scarcity of properties leads to a seller's market, where demand exceeds supply. High demand and rising prices also indicate a seller's market. An equal balance between buyers and sellers suggests a balanced market, but it lacks the distinct advantages that characterize a buyer's market.