The weather begins to turn warm, there are flowers in the air and millions of people begin to … yes, think about moving. In most states, the real estate market lies dormant for the most part in the cold winter months from November to February, and then – poof – it awakens.
The count on online real estate searches tracks the path of the sun. The warmer states, Hawaii and Florida peak in January and February when the weather is balmy and not too hot. Then in March and April, 31 states reach their peaks, including our fair California. No peaks in May and then in June and July there’s a surge in another 16.
Weather is not the only determinant of home buying interest and activity. While the nice weather makes shopping for a home a fun activity, it also coincides with the end of the school year. Folks with children find it convenient for their children to move between the end of the school year and beginning of a new one. Many adults, too, remain unconsciously on that school schedule as fall just seems to feel like a good time to commence life in a new place.
As real estate prices fluctuate with supply and demand, the seasonal patterns also influence asking and selling prices. It works this way. Buyers start their searches in early spring. To meet the demand, listings sprout in March and April. Asking prices are at their highest as well. Sales peak in June. As properties are scooped up and demand drops, prices may ease somewhat. New inventory comes aboard and tops out in July and August.
Interestingly, though sales drop into September, there seems to be a brief burst in October. It may be that motivated sellers, failing to get their price in the strong spring market, but still anxious to sell, decide to make concessions during this period.
So what does this all mean for you, buyer or seller? Well, you will probably have the greatest number of choices in the spring when inventory is high. But you will be unlikely to get a deal in a high demand market. Wait until off-season and there will be fewer choices but a better chance to negotiate a sales price and even more favorable terms on a mortgage. A seller who must leave a property during the holidays may be disposed to make a quick sweet deal.
If you are listing your house for sale, it is probably best to list by March and expose your property to the greatest number of prospective purchasers. It is recorded that 50 percent of all homes are sold from May to August. Most importantly, pricing your house no more than 5 percent over market will give you the best opportunity to capture a buyer. Overpricing just wastes valuable time when demand is high and may bring you begrudgingly into concession territory.
There’s no doubt that America is a nation on the move. This makes for a fluid and active real estate marketplace. According to the government census, the average time a family remains in a home is 5.2 years. Wikipedia tags this time period at five to seven years; zillow.com at seven years and the National Association of Home Builders at the longest – 12 years.
The lucky thing for sellers and buyers is that there is indeed a season for everyone and plenty of good choices all year round.
Del Phillips is a California Licensed Real Estate agent. He is a member of the National, California and San Diego Association of Realtors. You can reach Del at Ascent Real Estate at 619-298-6666 or at Del@DelPhillips.com DRE LIC #01267333.
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