What characterizes a Buyer's Market?

A Buyer's Market is characterized by lower home prices and weak demand, which is precisely why this choice is correct. In a Buyer's Market, there are typically more homes available for sale than there are buyers looking to purchase them. This oversupply of homes leads to competition among sellers to attract buyers, often resulting in reduced prices.

Weak demand means that, due to factors such as economic conditions or a lack of buyer interest, fewer people are looking to make purchases. Consequently, buyers hold more negotiating power, which can drive prices down further, making it advantageous for those looking to buy.

This environment is distinct from several other market conditions. In contrast, high demand and low interest rates would create a Seller's Market, where buyers are competing for limited homes, driving prices up. Increased property values coupled with high interest rates can also discourage buyers and do not align with the definition of a Buyer's Market. Stable prices and average demand suggest a balanced market, lacking the characteristics of either the excessive supply or buyer leverage seen in a Buyer's Market.