Is there really a ‘best’ time of year to sell or buy a house?
At a local monthly real estate meeting a longtime associate of mine, Mr. Claude Labbe (http://www.yourbusylife.com), gave a very interesting presentation. He analyzed local housing statics to determine if there is really a best time to buy or sell a house our area. And the survey says….
Yes, there is a best time to sell (spring or early summer) or buy (winter) a house.
Median Sales Price
The data is based on the date and price the home sold. With current average days-on-market at approximately 90 days, homes sold in the first quarter (January, February, March) were listed in late fall and put under contract in the winter period. Homes sold in the second quarter (April, May, June) were listed in early spring.
First and foremost the most impressive trends is that in the District, Maryland, Virginia (DMV) area the median price has increased over 20% in the last five years.
As the chart indicates, each individual market follows the same trend – sales dip starting in the fourth quarter and continue to decline into the first quarter with a dramatic spike in the sales price in the second quarter. There is an average increase of 11% in sale prices from the first quarter to the second quarter. Then a gradual decline of just under -5% from the spring time high to the winter time.
The Counter Argument
One key piece of data missing from this analysis is inventory. It is commonly accepted that more people buy homes in the spring and summer, so most people will hold off listing their homes until that time. This means there is a massive inventory of comparable homes in the spring and summer, but in the winter the cupboards are almost bare. This combined with the fact that people looking in the winter are typically ready, willing, and able to buy. A good home, priced well stands out in the market and will sell fairly quickly at a reasonable price.
I’m a believer in statistics and when the statics back-up what everyone already believes, then it’s hard to argue. The best time to buy is in the winter, the best time to sell is in spring and early summer.
If you are selling a home; get a good realtor who understands how to price your home based on your needs and the local market trends. Pricing too high during the wrong market can extend the time it takes to sell, potentially costing you money, and most likely making you very irritated. Pricing too low, costs you money, but during parts of the year it may be the only way to sell your house.
If you are a buyer, don’t wait, it’s January, the statistics show you can get a lower sales price now than in 3-4 months. Get a good realtor and start looking now, prices will start to rise again in April.