Currently, the market for a practice transition is a seller’s market. This means there are more buyers looking to acquire a practice than there are sellers looking to sell a practice. It has been this way for a number of years. But there are a number of factors that make the current market a perfect storm. These factors are as follows:
- There are not a lot of practices on the market. Low supply and high demand equate to higher practice values.
- Interest rates are still relatively low. This makes note payments more affordable, so buyers are looking to take advantage of lower rates by purchasing a practice.
- The economy is strong. Patients are getting their dentistry done. They are employed and have insurance, or can afford to pay cash and get work done.
- There are more buyers than sellers. Doctors have been holding on to their practices and delaying the sale of their practice in part because of the down market in 2008 to 2010. The average retirement age for dentists was 62 in 2000 – it’s now closer to 67.