But the answer to whether you should list your home during the fall is more complex than a simple yes or no, according to Lane Hornung, CEO of 8z Real Estate.
The pros and cons of listing your home this time of year is the subject of this month’s question and answer session between Lane and John Rebchook, of Denver Real Estate Watch.
The Q&A is part of 8z Real Estate’s Real Estate 101 series.
John: We recently spoke about the typical seasonal slowdown of home sales in the fall from the summer. Let’s start there and talk about whether it is a good idea to list your home during the time of year that almost always has a seasonal slowdown. So, should you list your home during the fall?
Lane: The backdrop for this question, the subtext, is something else we have discussed in the past: can you time the market? Not to sound like a broken record, but your personal needs should always take precedent over the time of year.
John: And by that you mean life happens and whether it is a divorce, birth of a child, a job transfer or something else, that can mean you need to sell your home, no matter the time of year, correct?
Lane: Exactly. If that is the case, don’t worry about the season.
John: What if you have the flexibility to sell now or wait five or six months?
Lane: If you have that flexibility, the argument can be made both ways.
John: Let’s take the argument of waiting until spring first.
Lane: That line of thinking is that you should wait, because demand from buyers will be higher in the spring. As a result, you might sell your home faster and you might sell it for more money, than if you sell it now. And, barring some macro, world-wide event that will negatively affect the broader economy, it is a pretty safe bet that demand will be higher.
And, right now, if somebody asked me if I thought prices will be higher six months from now, I say yes, I think prices will be higher, especially if you live in a hot market like Denver or in the Bay Area.
John: If someone is going to list their home in the spring, when should they get the process rolling?
Lane: Interestingly, if you want to close in March, you should put your home on the market in January. Thanks to the internet and mobile devices, people are starting the search for their homes right after New Years. It may be cold outside, but warm inside your home in front of your laptop or iPad searching online.
John: So if you are likely to sell your home for more in the spring, why not wait, if you can?
Lane: A lot of real estate practitioners believe that buyers out in the fall are more serious. There probably will be fewer ones out there, but they are typically more motivated, highly-qualified buyers. These buyers aren’t “kicking the tires.” So you are not going to be wasting your time with someone who is on the fence about buying a home.
John: And how about interest rates? They are still incredibly low today, but who knows where they will be next spring?
Lane: I’m glad you brought that up. Interest rates remain the wild card in the equation. I’ve been predicting for the past 3-plus years that rates were going to rise and I’ve been wrong. But at some point they are going to rise. And when they do, that could dampen demand and dampen rising prices even more than seasonality.
John: And what if you need to buy and sell a home?
Lane: If you need to find a replacement home, you might get slightly less for your home if you sell it now, but the flip side is that you stand to make a better deal on the home you buy. That could especially work in your favor if you are moving up. As a general rule, the more expensive the home, the longer it takes to sell, so you might find the sellers of higher priced homes to be especially motivated at this time of the year.
John: Of course, I don’t want to give the impression that the market has come to a standstill because the leaves are falling from the trees.
Lane: Absolutely not. Make no mistake, it is still a strong seller’s market. I was just talking to an 8zer today and she told me that nine offers came in for a house she is listing.
John: Anything else?
Lane: I would think for most people, they need to be cautious about putting their homes on the market after Thanksgiving through the Christmas holiday. I probably wouldn’t do that unless you really need to sell your home. As I said earlier, personal situations always trump the season.