When to Sell Your Home, Part 2
The first half of the year has been a pretty wild ride with inventory surges and droughts being very localized and inventory dependent. Understanding how inventory is trending in your area continues to be one of the most influential factors in how much you will sell your home for and how long it will take. In a follow up to our When to Sell Your Home Part 1 post written earlier this year, we have highlighted the pros and cons of selling your home in the 2nd half of the year from July to December. Knowing what typical conditions look like will help you decide if now is the right time to list your home.
July – August: Summer’s Calling
5 Year Sales To New Listing Ratio (SNLR): July 59%, August 62%
Active Listings: July 17,208, August 15,622
Summer months lead to a slow down in the real estate market. A 10-20% drop in sales is to be expected from June to July. Many listings listed or left on the market in July are properties that didn’t sell in the spring. The second half of August sometimes sees a jump in new inventory as Sellers try to beat their competition to the fall market.
Why Sell:
- Too much competition in the spring? While it’s true sales will drop as we head into the summer, so to does the number of new listings coming to market. Maybe your home will fair better when it doesn’t have to stack up against competing homes with more appealing features.
- Are listings in your area still attracting numerous bidders to the table as you round out June? If your area remains under-supplied as the spring wraps up, perhaps listing before inventory gets restored in the fall could be the right move.
Why Not:
- Summer is a time for vacations, long weekends and patios; not open houses, offers, and negotiations. Sales tend to drop in summer months as Buyers are preoccupied with other activities. Think about what type of Buyer is likely to be attracted to your home, if they are likely to spend their July and August on a dock in Muskoka, then summer might be the wrong time to sell.
- The average sale price tends to drop in the summer as prime properties are typically sold in the spring months to accommodate for the school year and summer time moves.
September – October: School is In
5 Year SNLR: September 49%, October 60%
Active Listings: September 17,459, October 16,405
It’s common to see an increase in the number of listings beginning in September as people get back to business after the summer holidays. Often Buyers trail a bit behind and it’s been more common for them to come to the table in October as shown in the stats above; October’s 5 year SNLR ratio outperformed September by 10%.
Why Sell:
- Too much competition in your neighbourhood this past spring. The fall often attracts Buyers looking for their first home or investors looking to park some money.
- Did the summer see lower than normal transactions? Expect Buyers who have been searching since the spring to become eager to make a purchase as the fall market gets going.
Why Not:
- If your target Buyer is likely to be someone upsizing, the fall market can be challenging for families looking to purchase a bigger home. Changing schools and selling their own home is something families prefer to do over the spring and summer months.
- Keep an eye on the Sales to New Listing Ratios for your area as September has proven to be one of the weaker months for sales in comparison to new listings coming to market.
November- December: Wrap It Up
5 Year SNLR: November 69%, December 99%
Active Listings: November 14,285, December 9,694
November remains a fairly active month for the market but things grind to a halt in December, the slowest month of the year. Sellers will often remove their listing from the market in December or just hold off listing until the New Year to enjoy the holiday festivities.
Why Sell:
- You find your dream home, but still need to sell your home. You may sacrifice some upside on the sale of your current property to avoid paying a premium on your purchase in the New Year.
- Listings are low. Active listings drastically shrink the closer you get to the end of December. It’s possible you’ll find impatient Buyers looking to purchase before the end of the year.
Why Not:
- Higher returns have traditionally come in the New Year as the average price often starts to jump higher as the months approach the busier spring market.
- Many of the Buyers looking at this time of year will be bargain hunting.
