'Very much' in this context means that the market is a buyer’s market to a large degree. The word ‘much’ is an adjective describing the market and very is an adverb describing ‘much’. Another example: The nature here is incredibly beautiful. ‘Beautiful’ is describing the nature which makes it an adjective and ‘incredibly’ is describing ‘beautiful’ which makes it an adverb.

“Very much a buyer’s market” means that prices are low and there are many things for sale. This phrase is commonly used in real estate. The use of “but” seems inaccurate. It is a lower number of buyers that at least in part produces a “buyer’s market”. So the speaker seems to be expressing the opinion that even though prices have fallen, the number of buyers hasn’t increased as much as he would have expected.

Used this way, “very much” means “to a large degree.” It is the opposite of “slightly” Sometimes, a market is balanced (favoring neither buyer nor seller); sometimes the market may be slightly tilted in favor of the buyer; but other times the market may be very tilted towards the buyer (that would be “very much a buyer’s market”).

In this example "very much" basically has the same as just "very", it's an intensifier. It isn't directly related to the number of people taking part in the market. I hope that was clear enough. If you still don't quite understand, feel free to ask.