There’s no shortage of advice online about the best time to list, and it all goes something like this: The vast majority of home sales occur when the weather heats up, and homes sold during this time of year tend to attract high prices. Conventional wisdom tells us it’s best to list early in the year. That way, you’re sure to benefit from the Spring peak in sales, and the premium pricing during the warmer months as well. List too late, we’re warned, and you could miss this warm weather bump.
At first blush, this conventional wisdom seems particularly wise. After all, there’s one thing that all homeowners looking to sell have in common — they want to do so as quickly as possible, and for as much money as possible. Listing early, in theory, means more buyers looking to buy and less competition from other sellers, and therefore a better chance of closing faster and for a good price.
But when you stop and think about it, this advice is rather imprecise — almost unhelpfully so. “Early in the year” could mean January 1, or April 30, or any date in between.
Until recently, there was simply no way to crunch the numbers to determine the most advantageous moment for homeowners to put their property on the market. This isn’t because economists hadn’t figured out the right method of analysis. Rather, economists hadn’t had access to all the relevant data.
It all comes down to supply and demand. In order to identify the window when sellers have the best shot at selling quickly for the most money, you need good data on four important questions:
- When are buyers looking to buy?
- When are sellers looking to sell?
- When are these listings and sales taking place?
- Did the sale under-perform or over-perform?
Now for the first time, the answers to all these questions exist in the same place, readily available to consumers, and we can finally answer that simple question on every home seller’s mind, the one that no one has been able to precisely answer until now:
When exactly should I list?
When prospective buyers start contacting agents, it is a clear indication they are getting serious about house-hunting. Sure enough, analyzing on-line traffic from The Cascade Team, Zillow, Trulia, Realtor.com and other real estate sites, we can see that spike in agent inquiries translate into actual home sales. Typically, after the normal spike in agent contacts, sales reach their highest levels just a few weeks later.
And that time is NOW: MARCH
For 4 straight years in the greater Seattle area homes listed in March and closing in April have received the highest sales price each year when compared to other months. In fact, waiting just 1 month and listing in April with closings taking place in May or June have shown to cost some homeowners over $100,000 in sales price compared to similar homes that listed in March and closed in April!
For a quick example I did the stats for area 540 which is Issaquah, Sammamish, Snoqualmie and North Bend.
For Residential alone in area 540 April 1-8 there were only 13 total active properties for sale.
Just one month later in area 540 May 1-8 that total for the same criteria went to 114 Properties….. That is an increase of nearly 9-fold in just 30 days which had a huge impact on Days on Market and Price appreciation…
It appears that just like in 2018, 2017 and 2016 the HIGHEST average sale price for the year will be in April (Which means people listed in March and Closed in April)
People who waited until April or May to list will still get a great price BUT that price will typically NOT be as high as for March listings (There are of course always exceptions)
Right now, in the greater Seattle area we are experiencing exactly such a spike in contacts and web traffic known to lead to a surge in sales! In fact, web traffic has spiked over 300% just on The Cascade Team alone as Sellers prepare to sell and buyers become eager to take advantage of increasing inventory and lower rates.
New housing data indicates the greater Seattle area is already pulling out of a month’s long slump, during which the median luxury home price fell 13% in six months, sales plummeted and some predicted doomsday scenarios where skilled workers would flee Seattle, birthplace of Microsoft and Amazon, for budding tech hubs in the South and East Coast. But in January and February, Seattle-based agents reported bustling open houses and an earlier-than-usual start to the spring buying season. So, if you’re looking to take advantage of the city’s softened market conditions—it’s now or never.
Home price has climbed each year by double digits, faster than almost anywhere else in the U.S., which made the sudden jolt to the market last summer all the more jarring. By the fourth quarter of 2018, the median luxury sales price was $2.23 million, down 13% from its May peak of $2.562 million and sales dropped more than 20%.
Seattle wasn’t alone. Many U.S. cities experienced slowing sales and waning price growth in the second half of 2018, as affordability, the uncertainty of midterm elections and rising interest rates put off buyers.
It’s likely the median sales price will continue to decline in the coming months. But that's more a reflection of last year’s fracas rather than a real-time lens into market conditions because closing data has a time lag.
Instead, buyers and sellers should look at the recent boost in pending sales, a timelier measure. In the city of Seattle, there were 762 homes that went into contract in January, a near-30% increase compared to a year ago, according to data from the Northwest Multiple Listing Service. The pricey Eastside, which includes Bellevue, Sammamish, Woodinville and Redmond, has also seen a bump in activity. Pending sales there increased 10% in January compared to a year ago.
Inventory in the area has more than doubled since this time last year, building up during the slowdown in 2018 and giving buyers more options. Meanwhile, a recent decline in 30-year mortgage rates has also boosted confidence and purchase power.
Therefore, the conventional wisdom that sellers should list early in the year is spot-on. But what does “early” mean? Is there such a thing as too early? Is there a sweet spot for listing your home so that it has the best chance of selling fast and for more money? Is there a measurable impact if you list before or after the peak?
The answer to all of these questions is a resounding yes. Our analysis shows that listing too early or too late does result in more time on the market and a lower sale price. There is a sweet spot when sellers should list and hitting it can pay off to the tune of tens of thousands of dollars.
But the data gives us more than just an interesting picture of supply and demand. It also tells us how long it takes every single listing to sell, how the sale price of each listing compares to the estimated home value at the time it was listed, and what kind of homes are on the market at any given time. That means we can pinpoint not just the season, but also the exact weeks when it’s most opportune for sellers to list their homes.
Our analysis of the data shows that homes listing in the first three weeks of March will sell the fastest and for the most money! These “magic weeks” come just before the peak in agent contacts and just after the peak in newly listed homes. Our analysis showed that these high-performing, late-March and early April listings didn’t get lost in the sea of other new listings. Just the opposite; “Sellers that have come to market ahead of the traditional spring market are reaping the benefits of less competition [from others who are selling] and a highly competitive buyer pool.”
So, if you are wondering about our current market, then let me assure you: It is indeed a fabulous time to sell! Not only will your "days on market" be fewer by listing early, you might also end up making significantly more money on your sale than someone waiting until May and trying to time the end of the school year for example.
It's generally a good idea to take advantage of pent-up demand because it's the demand that drives competition. The larger number of buyers for your home ought to increase the odds you'll make more money. Some homes, especially those referred to as unique homes, meaning homes that can be difficult to sell in any real estate market, will generally stand a better chance of selling with less competition.
While you can’t perfectly predict these moments of opportunity, you can detect them. At the beginning of the home sales season, keep your eye on new listings in the neighborhood where you’re selling your home. Monitor them as they ramp up and, most importantly, take note when they begin to slow down.
And lastly... And "Maybe" just for fun... I had to drop this one last bit of basketball related information!