What is a key aspect of seller’s markets regarding property pricing?

In a seller's market, there is a higher demand for properties than there is supply available. This imbalance typically leads to increased competition among buyers, which drives property prices upward. As potential buyers compete for fewer homes, they may be willing to offer higher prices or even engage in bidding wars, further escalating the prices of properties. The limited supply means that sellers have more leverage, allowing them to set higher prices compared to a balanced or buyer's market scenario where there is ample inventory. Understanding this dynamic is crucial for real estate professionals, as it directly impacts pricing strategies and market analysis. Thus, the key aspect of pricing in a seller's market is the tendency for prices to increase due to the limited availability of properties.