People need homes, no matter the time of year, so you wouldn’t think weather would affect this market. However, it plays a key factor in home sales. If you’re in the market to sell your home, you may not know that there’s actually a best month and season to sell your home.
In the spring of 2016, Zillow published a study that revealed the best time to sell a house was from mid-April to mid-May. In fact, homes listed between the beginning of May and May 15 sold about 18.5 days faster than homes listed on other dates. These homes also saw a one percent increase in asking price, and home sellers earned about $1,700 more per listing.
On the flipside, the data showed that the worst dates for home sales are November through January. Studies have tried to determine the reasoning and there have been a few key factors.
The first is the weather. During a cold winter, particularly in areas that receive snow and wind, people don’t want to trudge outside in search of a home. Homes don’t look as good with gray skies and dormant plants, either.
When winter is over, people have spring fever and are excited about the prospect of a new and a beautiful change of scenery. At this point, home sales skyrocket.
“More people shop for homes when the weather is nice out, so depending on regional differences like climate, this timeframe can shift depending on where you live,” says an article from Huffington Post. “Homes in locations that experience more intense seasonal changes, like Baltimore and Minneapolis, are more likely to have a key optimal selling window. Warmer climate states like California have more flexibility.”
The second reason deals with money. From November to January, people are focused on the holidays. The average American household spends about $1,000 on holiday shopping, and many go into debt. Making a huge purchase, like a home, is the last thing on their minds during this time.
A third reason is the school year. For family buyers, who make up the majority of single-family home purchases, the school year also plays a chief role in spring home sales. It’s hard to uproot your family in the middle of the school year, let alone get the packing and moving done when you’re tied to such a rigid schedule.
Families often purchase their homes in May because it’s right at the end of the school year. By the time escrow goes through, school will be out, and families will have an easier time moving.
Home sales occur year round, but there are some real advantages to selling your home in the spring.
For starters, your home’s valuation will be a lot higher. When the appraiser puts a value on your home, they’ll visit other homes in the area and determine the state of the market. Houses will sell at a higher price in your neighborhood, which will raise the valuation of your property.
The demand for homes also drives prices up. The interesting thing about home sales is that they don’t devalue when the market is flooded with buyers. Instead, prices rise. This is because home values and asking prices depend on the existing market. As homes sell for high prices around yours, it creates a higher price for your property.
Thanks to the demand for homes in the spring and summer, you’ll see more offers and have a greater chance of getting into a bidding war.
Those who sell their homes in early May tend to see much higher sales, “and the reason is because inventory being so tight, a lot of homebuyers are having to put in multiple offers. That is extending the length of the homebuying season, such that a lot of times later on in the season people are more eager to buy the house because they have been frustrated with earlier offers, and they are paying a little bit more money,” said Stan Humphries, chief economist at Zillow Group.
Most homes sell during the beginning of May, so if you want in on this highly profitable season, should you list your home a few months in advance? The Zillow study would advise against listing your home so early.
“As a home seller, your biggest competition is a surge in new homes for sale, pushing yours lower in search results. The largest surge nationally occurs in the last weeks of February and into early March, so if you list your home before then, you may quickly become outranked.”
If you wait until late March or early April to list your home, you’ll likely bypass your biggest competition. You’ll have an easier time selling your home quickly, and your home won’t risk dropping in valuation from sitting too long on the market, which is why you don’t want to list your home too early.
If you sell your home this spring with a typical Houston realty company, you’ll forfeit about six percent of your selling price. When you use a flat fee realty company like Green Residential, you can save thousands on commission fees and still get the same quality service.
We can help with everything including taking professional quality photos, polishing and posting your listings, scheduling and administering showings, and finalizing contract negotiations and preparations. We service Houston and the surrounding areas, and would love to work with you. For more information, contact us today!
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